Embecta Corp (EMBC)

Receivables turnover

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021
Revenue (ttm)	US$ in thousands	1,116,800	1,115,200	1,110,600	1,115,600	1,108,100	1,123,300
Receivables	US$ in thousands	206,400	159,100	190,100	152,700	143,300	133,100	119,200	15,200	118,300
Receivables turnover		5.41	7.01	5.84	7.31	7.73	8.44

December 31, 2023 calculation

Receivables turnover = Revenue (ttm) ÷ Receivables
= $1,116,800K ÷ $206,400K
= 5.41

The receivables turnover ratio measures how efficiently a company is collecting its accounts receivable during a specific period. A higher ratio indicates that the company is collecting its outstanding receivables more quickly.

Analyzing the data provided for Embecta Corp, we observe fluctuations in the receivables turnover ratio over the past few quarters. In general, a higher receivables turnover ratio is preferred as it signifies a more efficient collection process.

Looking at the trend, we see that the receivables turnover ratio has been declining from a peak of 8.44 in the third quarter of 2022 to 5.41 in the most recent quarter, December 31, 2023. This decline may indicate that the company is taking longer to collect its accounts receivable, which could potentially impact cash flow and liquidity.

It is essential for Embecta Corp to closely monitor and manage its accounts receivable collection process to ensure optimal cash flow and financial health. Further analysis of the reasons behind the decreasing trend in receivables turnover is warranted to address any underlying issues and improve overall efficiency in collections.