Harmony Biosciences Holdings (HRMY)

Working capital 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	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020
Revenue (ttm)	US$ in thousands	548,499	507,747	476,532	451,378	419,060	383,158	319,980	290,957	268,890	236,824	233,336
Total current assets	US$ in thousands	451,070	462,998	455,641	418,087	400,285	382,082	322,702	280,257	284,439	240,691	204,714	177,744	262,891	250,242
Total current liabilities	US$ in thousands	163,781	112,408	93,045	85,363	78,884	107,357	65,764	56,528	53,775	47,623	36,595	33,437	134,539	31,790
Working capital turnover		1.91	1.45	1.31	1.36	1.30	1.39	1.25	1.30	1.17	1.23	1.39

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $548,499K ÷ ($451,070K – $163,781K)
= 1.91

Harmony Biosciences Holdings Inc's working capital turnover has exhibited fluctuations over the past eight quarters, ranging from a low of 1.36 in Q4 2022 to a high of 2.03 in Q4 2023. The working capital turnover ratio indicates how efficiently the company is utilizing its working capital to generate sales revenue.

A higher working capital turnover ratio signifies that the company is effectively managing its working capital to support its sales activities. In the case of Harmony Biosciences, the increasing trend in the working capital turnover ratio from Q1 2022 to Q4 2023 suggests an improvement in the company's ability to generate revenue relative to its working capital investment.

However, it is essential to note that a very high working capital turnover ratio may also indicate aggressive management of working capital, possibly at the expense of liquidity or flexibility. On the other hand, a lower ratio could suggest inefficiencies in working capital management or challenges in generating sales relative to the level of working capital.

Overall, the variations in Harmony Biosciences' working capital turnover indicate changes in the company's operational efficiency and financial performance, highlighting the need for further analysis to determine the factors driving these fluctuations and their potential impacts on the company's financial health.