Edwards Lifesciences Corp (EW)

Working capital turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenue	US$ in thousands	5,439,500	6,004,800	5,382,400	5,232,500	4,386,300
Total current assets	US$ in thousands	6,285,400	4,035,700	3,095,800	3,180,700	3,091,000
Total current liabilities	US$ in thousands	1,505,200	1,195,400	1,022,400	1,032,300	893,900
Working capital turnover		1.14	2.11	2.60	2.44	2.00

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $5,439,500K ÷ ($6,285,400K – $1,505,200K)
= 1.14

The working capital turnover for Edwards Lifesciences Corp has shown variability over the past five years. It increased from 2.00 in December 2020 to 2.60 in December 2022, indicating an improvement in the company's efficiency in utilizing its working capital to generate sales. However, there was a slight dip to 2.11 in December 2023 before dropping significantly to 1.14 in December 2024.

The higher working capital turnover ratios suggest that the company is effectively managing its working capital to support its sales activities. A rising trend in this ratio generally indicates that the company is becoming more efficient in utilizing its current assets to support its operations.

On the other hand, a decrease in the working capital turnover ratio may raise concerns regarding the company's ability to efficiently convert its working capital into sales revenue. The notable decline in the ratio in December 2024 may require further investigation to understand the underlying reasons for the decrease and evaluate the impact on the company's overall financial performance.