Globus Medical (GMED)

Working capital turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenue	US$ in thousands	2,519,360	1,568,480	1,022,840	958,102	789,042
Total current assets	US$ in thousands	2,177,260	1,915,370	983,344	864,516	821,765
Total current liabilities	US$ in thousands	855,913	392,347	159,204	140,164	120,792
Working capital turnover		1.91	1.03	1.24	1.32	1.13

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $2,519,360K ÷ ($2,177,260K – $855,913K)
= 1.91

Working capital turnover, calculated as revenue divided by average working capital, is a measure of how efficiently a company is using its working capital to support sales.

Based on the data provided, Globus Medical's working capital turnover has been fluctuating over the past five years:
- In December 31, 2020, the working capital turnover was 1.13.
- By December 31, 2021, it increased to 1.32, indicating an improvement in the efficiency of utilizing working capital to generate revenue.
- However, by December 31, 2022, the ratio decreased slightly to 1.24 but remained relatively stable.
- A notable decrease was observed by December 31, 2023, where the working capital turnover dropped to 1.03, suggesting a potential inefficiency in working capital management during that period.
- The most significant improvement was seen by December 31, 2024, with a sharp increase to 1.91, indicating a significant increase in the efficiency of using working capital to generate revenue.

Overall, fluctuating working capital turnover ratios indicate varying levels of efficiency in managing working capital to support sales over the years, with potential areas for improvement identified in certain periods.