OSI Systems Inc (OSIS)

Working capital turnover

Jun 30, 2025 Mar 31, 2025 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
Revenue (ttm) US$ in thousands 1,713,166 1,689,088 1,650,140 1,603,555 1,538,758 1,469,721 1,367,204 1,289,566 1,278,427 1,203,378 1,190,966 1,172,050 1,183,236 1,178,613 1,171,923 1,171,251 1,146,902 1,091,671 1,100,767 1,130,100
Total current assets US$ in thousands 1,422,860 1,272,530 1,324,570 1,310,000 1,215,520 1,119,250 1,003,080 872,099 839,903 778,534 767,435 771,044 746,144 758,536 769,790 730,210 709,404 661,410 634,424 614,793
Total current liabilities US$ in thousands 696,938 603,957 703,718 712,536 814,637 761,682 700,391 611,628 571,694 550,413 538,242 562,481 613,954 645,836 694,455 656,788 344,767 326,069 333,393 333,937
Working capital turnover 2.36 2.53 2.66 2.68 3.84 4.11 4.52 4.95 4.77 5.28 5.20 5.62 8.95 10.46 15.56 15.95 3.15 3.26 3.66 4.02

June 30, 2025 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $1,713,166K ÷ ($1,422,860K – $696,938K)
= 2.36

The working capital turnover ratio of OSI Systems Inc. demonstrates a dynamic trend over the period from September 2020 through June 2025. During the initial phase, from September 2020 to March 2021, the ratio declined gradually from 4.02 to 3.26, indicating a moderate decrease in efficiency in utilizing working capital to generate sales.

A significant shift is observed starting in September 2021, where the ratio sharply increases to 15.95 from 3.15 in June 2021. This surge suggests a notable improvement in working capital efficiency, potentially attributable to strategic operational changes, increased sales relative to working capital, or shifts in working capital management practices.

Following this peak, the ratio exhibits a gradual downward trend, decreasing to approximately 5.62 by September 2022 and maintaining relative stability around the mid-5 range through the end of 2022 and into mid-2023. This decline signifies a moderation in the previous efficiency gains, possibly due to changes in sales volumes, working capital structure, or operational scale.

From late 2023 through mid-2025, the ratio continues to decline, reaching approximately 2.36 by June 2025. This sustained decrease suggests a reduction in the efficiency of working capital utilization, which could be indicative of increased working capital levels, changes in sales efficiency, or shifts in operational priorities.

Overall, the observed fluctuations in OSI Systems Inc.'s working capital turnover ratio reflect periods of operational optimizations punctuated by phases of reduced efficiency. The sharp increase in late 2021 warrants further analysis to uncover underlying causes, while the subsequent decline indicates evolving operational or financial strategies impacting working capital management.