Eli Lilly and Company (LLY)

Working capital turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenue	US$ in thousands	45,042,700	34,124,100	28,541,400	28,318,400	24,539,800
Total current assets	US$ in thousands	32,739,700	25,727,000	18,034,500	18,452,400	17,462,100
Total current liabilities	US$ in thousands	28,376,600	27,293,200	17,138,200	15,052,700	12,481,600
Working capital turnover		10.32	—	31.84	8.33	4.93

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $45,042,700K ÷ ($32,739,700K – $28,376,600K)
= 10.32

The working capital turnover ratio for Eli Lilly and Company has shown significant improvement over the years. In December 31, 2020, the ratio stood at 4.93, indicating that the company generated approximately $4.93 of revenue for every $1 of working capital. By December 31, 2021, the ratio increased to 8.33, suggesting the company became more efficient in utilizing its working capital to generate sales.

The most notable improvement came in December 31, 2022, where the working capital turnover ratio surged to 31.84, reflecting a substantial increase in revenue generation relative to the working capital invested. This sharp rise suggests enhanced operational efficiency, effective management of inventory, receivables, and payables, or possibly a strategic shift in business operations.

Unfortunately, data for December 31, 2023, is unavailable (displayed as "—"), potentially due to reporting delays or alterations in disclosure practices. Nevertheless, the previous trend indicates a strong focus on maximizing revenue from working capital.

The working capital turnover ratio decreased slightly to 10.32 by December 31, 2024, but it remains relatively high compared to the initial values. This suggests that Eli Lilly and Company continues to effectively leverage its working capital resources to drive sales. Overall, the improving trend in the working capital turnover ratio underscores the company's efficient management of working capital and its ability to generate revenue efficiently.