Lululemon Athletica Inc. (LULU)

Working capital turnover

		Jan 28, 2024	Oct 29, 2023	Jul 30, 2023	Apr 30, 2023	Jan 29, 2023	Oct 30, 2022	Jul 31, 2022	May 1, 2022	Jan 30, 2022	Oct 31, 2021	Aug 1, 2021	May 2, 2021	Jan 31, 2021	Nov 1, 2020	Aug 2, 2020	May 3, 2020	Feb 2, 2020	Nov 3, 2019	Aug 4, 2019	May 5, 2019
Revenue (ttm)	US$ in thousands	9,616,970	9,206,170	8,858,840	8,518,010	8,140,340	7,493,410	7,086,940	6,669,230	6,250,340	5,821,210	5,488,220	4,940,542	4,393,223	4,074,043	3,872,751	3,853,161	3,977,845	3,749,265	3,580,782	3,420,930
Total current assets	US$ in thousands	4,060,580	3,364,900	3,323,930	3,053,300	3,159,450	2,634,180	2,387,090	2,303,240	2,614,850	2,311,290	2,275,310	2,253,450	2,124,380	1,600,810	1,489,760	1,694,540	1,807,940	1,451,680	1,333,010	1,171,580
Total current liabilities	US$ in thousands	1,631,260	1,448,110	1,386,370	1,256,770	1,492,200	1,322,840	1,207,210	1,206,890	1,405,330	1,118,020	981,354	964,814	883,178	730,878	763,309	631,496	620,418	574,769	552,609	502,942
Working capital turnover		3.96	4.80	4.57	4.74	4.88	5.71	6.01	6.08	5.17	4.88	4.24	3.83	3.54	4.68	5.33	3.62	3.35	4.28	4.59	5.12

January 28, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $9,616,970K ÷ ($4,060,580K – $1,631,260K)
= 3.96

The working capital turnover ratio for Lululemon Athletica Inc. has exhibited fluctuations over the time period provided, ranging from 3.35 to 6.08. This ratio measures how efficiently the company is using its working capital to generate sales revenue. A higher ratio indicates that the company is effectively utilizing its working capital to generate sales.

In the recent quarters, the working capital turnover ratio has shown a generally increasing trend, peaking at 6.08 in July 2022. This may indicate improvements in the management of working capital and a more efficient allocation of resources to drive sales.

However, there have been periods where the ratio decreased, such as in August 2020 and February 2020. This suggests potential inefficiencies in working capital management during those times.

Overall, a high working capital turnover ratio can be seen as positive, reflecting strong sales relative to the amount of working capital invested. It also signifies good liquidity and operational efficiency. Lululemon Athletica Inc. should continue to monitor this ratio to ensure optimal utilization of its working capital in driving sales growth.