Eli Lilly and Company (LLY)

Working capital turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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	Jun 30, 2020	Mar 31, 2020
Revenue (ttm)	US$ in thousands	45,042,700	40,863,300	38,922,800	35,932,100	34,124,100	32,072,500	29,515,500	27,691,400	28,541,400	29,239,500	29,070,700	29,322,800	28,318,400	27,758,500	26,726,300	25,485,600	24,539,800	23,213,800	22,949,800	23,087,100
Total current assets	US$ in thousands	32,739,700	31,415,100	30,204,300	25,188,800	25,727,000	23,007,000	21,331,600	20,811,400	18,034,500	17,639,900	17,115,200	16,964,700	18,452,400	17,808,300	17,295,500	16,604,500	17,462,100	16,239,900	14,581,900	13,994,200
Total current liabilities	US$ in thousands	28,376,600	24,674,100	27,121,200	18,598,100	27,293,200	21,998,200	18,915,000	16,010,000	17,138,200	15,652,800	15,620,600	13,386,000	15,052,700	13,682,000	15,093,200	11,714,200	12,481,600	11,976,900	11,988,500	12,610,200
Working capital turnover		10.32	6.06	12.62	5.45	—	31.79	12.21	5.77	31.84	14.71	19.45	8.19	8.33	6.73	12.14	5.21	4.93	5.45	8.85	16.68

December 31, 2024 calculation

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

The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales revenue. A higher ratio indicates better efficiency in utilizing working capital.

Analyzing the working capital turnover of Eli Lilly and Company from March 2020 to December 2024, we observe fluctuations in the ratio over the periods. The ratio was relatively high at 16.68 in March 2020, indicating efficient utilization of working capital to generate sales. However, the ratio decreased to 4.93 in December 2020, possibly indicating challenges in managing working capital efficiently during that period.

Subsequently, there was some improvement in the ratio in 2021, with a peak at 31.84 in December 2022, suggesting a significant improvement in utilizing working capital efficiently to generate sales. However, the ratio dropped to 5.77 in March 2023, indicating a decline in the efficiency of working capital utilization.

In the later periods, the ratio fluctuated between 5.45 and 12.62, suggesting varying levels of efficiency in working capital management. The sudden absence of data for December 2023 makes it difficult to assess the trend accurately for that period.

Overall, Eli Lilly and Company experienced fluctuations in its working capital turnover ratio during the analyzed period, indicating variations in the efficiency of working capital utilization to generate sales revenue. It is essential for the company to monitor and improve its working capital management practices to ensure consistent efficiency in utilizing working capital.