Planet Fitness Inc (PLNT)
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 | 1,160,425 | 1,082,185 | 1,045,786 | 1,009,840 | 986,001 | 984,910 | 952,853 | 891,685 | 852,544 | 755,272 | 666,937 | 580,823 | 510,272 | 479,125 | 428,591 | 330,645 | 346,043 | 403,782 | 472,257 | 622,556 |
| Total current assets | US$ in thousands | 588,019 | 556,444 | 493,850 | 520,782 | 471,817 | 540,119 | 505,339 | 588,759 | 555,531 | 540,471 | 523,382 | 615,635 | 662,414 | 629,112 | 581,255 | 556,194 | 566,816 | 561,130 | 581,481 | 664,470 |
| Total current liabilities | US$ in thousands | 282,495 | 286,290 | 272,126 | 246,501 | 251,329 | 272,846 | 274,414 | 250,223 | 244,530 | 258,139 | 263,556 | 326,003 | 176,610 | 160,185 | 135,079 | 115,189 | 111,895 | 120,365 | 134,578 | 180,164 |
| Working capital turnover | 3.80 | 4.01 | 4.72 | 3.68 | 4.47 | 3.69 | 4.13 | 2.63 | 2.74 | 2.68 | 2.57 | 2.01 | 1.05 | 1.02 | 0.96 | 0.75 | 0.76 | 0.92 | 1.06 | 1.29 |
December 31, 2024 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $1,160,425K ÷ ($588,019K – $282,495K)
= 3.80
The working capital turnover of Planet Fitness Inc has shown fluctuating trends over the analyzed period from March 31, 2020, to December 31, 2024. The working capital turnover ratio measures how effectively a company utilizes its working capital to generate sales revenue.
Initially, from March 31, 2020, to March 31, 2021, the working capital turnover decreased steadily from 1.29 to 0.75, indicating a decline in the efficiency of utilizing working capital to generate revenue. This could suggest potentially inefficient management of working capital during this period.
However, from June 30, 2021, to December 31, 2024, the working capital turnover ratio exhibited a positive trend, increasing from 0.96 to 3.80. This upward trend suggests an improvement in the company's efficiency in converting working capital into sales, reflecting a more effective management of resources and potential growth opportunities.
The significant increase in the working capital turnover ratio in the most recent periods, particularly from March 31, 2023, to June 30, 2024, indicates a notable enhancement in working capital efficiency, potentially driven by better inventory management, receivables collection, and overall operational effectiveness.
In conclusion, the working capital turnover ratio of Planet Fitness Inc has shown varying trends over the analyzed period, indicating fluctuations in the company's efficiency in utilizing its working capital. The recent increase in the ratio suggests improved operational efficiency and effective management of working capital, which could positively impact the company's financial performance and growth prospects.