OSI Systems Inc (OSIS)

Working capital turnover

		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	Dec 31, 2019	Sep 30, 2019
Revenue (ttm)	US$ in thousands	1,538,758	1,464,019	1,361,502	1,283,864	1,272,725	1,200,950	1,188,538	1,169,622	1,180,808	1,174,471	1,167,781	1,167,109	1,142,760	1,087,192	1,096,288	1,125,621	1,161,565	1,175,951	1,187,352	1,185,215
Total current assets	US$ in thousands	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	617,709	638,370	648,289	637,136
Total current liabilities	US$ in thousands	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	330,101	375,962	383,936	394,702
Working capital turnover		3.84	4.09	4.50	4.93	4.75	5.26	5.19	5.61	8.93	10.42	15.50	15.90	3.13	3.24	3.64	4.01	4.04	4.48	4.49	4.89

June 30, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $1,538,758K ÷ ($1,215,520K – $814,637K)
= 3.84

The working capital turnover ratio for OSI Systems Inc has shown fluctuating trends over the past few years. In the most recent period, the ratio stood at 3.84, indicating that the company generated $3.84 in sales for every dollar of working capital. This represents a decrease from the previous quarter's ratio of 4.09, suggesting a potential inefficiency in managing working capital to generate sales.

Looking further back, the ratio exhibited a gradual increase from the end of 2019 to mid-2022, peaking at 15.90 in the first quarter of 2022. This significant increase indicates that the company was able to efficiently utilize its working capital to generate sales during that period.

However, there was a sharp decline in the working capital turnover ratio in the subsequent quarters, dropping to 3.13 in the third quarter of 2022. This sudden decrease could signal potential issues with managing working capital efficiently or changes in the company's sales or working capital structure.

Overall, it is important for OSI Systems Inc to closely monitor its working capital turnover ratio and ensure that it remains at a level that reflects efficient management of working capital to support sales generation.