Eli Lilly and Company (LLY)

Working capital turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	34,124,100	28,541,400	28,318,400	24,539,800	22,319,500
Total current assets	US$ in thousands	25,727,000	18,034,500	18,452,400	17,462,100	13,709,600
Total current liabilities	US$ in thousands	27,293,200	17,138,200	15,052,700	12,481,600	11,775,200
Working capital turnover		—	31.84	8.33	4.93	11.54

December 31, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $34,124,100K ÷ ($25,727,000K – $27,293,200K)
= —

The working capital turnover ratio for Lilly(Eli) & Co has fluctuated over the past five years. In 2023, the ratio was not provided, making it difficult to assess the company's efficiency in managing its working capital for that year. However, in 2022, the company achieved a high working capital turnover of 31.84, indicating a significant increase in the efficiency of converting working capital into revenue compared to the prior years.

In 2021, the working capital turnover ratio decreased to 8.33, representing a decline in the company's ability to utilize its working capital effectively to generate revenue. This may suggest potential inefficiencies or challenges in managing working capital during that period. The ratio further dropped in 2020 to 4.93, indicating a continued decrease in the efficiency of working capital utilization.

However, in 2019, the working capital turnover ratio improved to 11.54, showing a positive trend in the company's ability to turn working capital into revenue efficiently. Overall, the fluctuation in the working capital turnover ratio over the past five years indicates variability in the company's working capital management effectiveness and highlights the importance of closely monitoring and optimizing working capital utilization for financial performance improvement.