GE HealthCare Technologies Inc. (GEHC)
Working capital turnover
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | ||
|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 19,107,000 | 18,958,000 | 18,917,000 | 18,895,000 | 18,952,000 | 19,284,000 |
| Total current assets | US$ in thousands | 9,901,000 | 10,638,000 | 8,806,000 | 9,373,000 | 9,410,000 | 9,468,000 |
| Total current liabilities | US$ in thousands | 9,553,000 | 8,670,000 | 8,318,000 | 8,859,000 | 8,981,000 | 7,565,000 |
| Working capital turnover | 54.91 | 9.63 | 38.76 | 36.76 | 44.18 | 10.13 |
December 31, 2024 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $19,107,000K ÷ ($9,901,000K – $9,553,000K)
= 54.91
The working capital turnover ratio measures how efficiently a company utilizes its working capital to generate sales. A higher ratio indicates that the company is effectively managing its working capital.
In the case of GE HealthCare Technologies Inc., the working capital turnover ratio has varied over the periods provided. In September 2023, the ratio was 10.13, indicating that the company generated $10.13 in revenue for every dollar of working capital invested.
The ratio significantly increased to 44.18 by December 2023, demonstrating a substantial improvement in working capital efficiency. This suggests that the company was able to generate significantly higher sales with the same amount of working capital.
In the subsequent periods, the ratio remained relatively high, with values of 36.76, 38.76, and 54.91 by March 31, 2024, June 30, 2024, and December 31, 2024, respectively. These high ratios reflect a consistent trend of efficient working capital management and strong sales generation relative to working capital.
However, it is notable that there was a sharp decline in the ratio to 9.63 in September 2024, indicating a temporary decrease in the efficiency of working capital utilization during that period.
Overall, the working capital turnover ratios of GE HealthCare Technologies Inc. demonstrate effective management of working capital to drive sales, with some fluctuations observed in certain periods.
Peer comparison
Dec 31, 2024