Lantheus Holdings Inc (LNTH)

Working capital turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenue	US$ in thousands	1,533,910	1,296,430	935,061	425,208	339,410
Total current assets	US$ in thousands	1,326,630	1,085,820	677,616	235,791	184,225
Total current liabilities	US$ in thousands	240,526	187,350	247,701	90,497	80,504
Working capital turnover		1.41	1.44	2.17	2.93	3.27

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,533,910K ÷ ($1,326,630K – $240,526K)
= 1.41

Working capital turnover measures how efficiently a company is using its working capital to generate sales revenue. In the case of Lantheus Holdings Inc, there has been a declining trend in the working capital turnover over the past five years.

In 2020, the working capital turnover was 3.27, indicating that the company generated $3.27 in revenue for every dollar of working capital invested. However, by the end of 2024, this ratio had decreased to 1.41, showing a significant drop in efficiency.

The decreasing trend in working capital turnover suggests that Lantheus Holdings Inc may be experiencing challenges in managing its working capital effectively to support its sales activities. This could be a concern as a lower turnover ratio may imply inefficiencies in the company's operations or difficulties in converting its working capital into sales revenue.

It is important for Lantheus Holdings Inc to closely monitor and address the factors contributing to the decline in working capital turnover to enhance operational efficiency and financial performance. Strategies to improve working capital management, such as optimizing inventory levels, accelerating accounts receivable collection, and delaying accounts payable payments, could help the company improve its working capital turnover and overall profitability in the future.