Perrigo Company PLC (PRGO)

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 4,373,800 4,392,400 4,428,700 4,556,100 4,655,500 4,653,900 4,630,300 4,558,900 4,451,700 4,401,300 4,343,800 4,203,200 4,138,700 4,323,300 4,494,300 4,732,300 5,063,300 5,096,600 5,074,000 5,003,900
Total current assets US$ in thousands 2,481,900 3,707,800 2,959,100 2,806,400 2,832,900 2,765,300 2,773,000 2,740,700 2,719,900 2,583,300 2,651,500 3,935,500 3,859,900 4,225,900 4,420,200 4,488,600 3,133,500 3,398,300 3,803,500 3,046,200
Total current liabilities US$ in thousands 1,044,200 1,450,500 1,488,100 1,554,500 1,586,300 1,008,400 1,056,900 1,086,800 1,113,600 1,015,000 1,014,600 981,300 1,587,900 2,003,800 1,984,500 1,446,800 1,382,000 1,336,300 1,859,700 1,635,000
Working capital turnover 3.04 1.95 3.01 3.64 3.73 2.65 2.70 2.76 2.77 2.81 2.65 1.42 1.82 1.95 1.85 1.56 2.89 2.47 2.61 3.55

December 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $4,373,800K ÷ ($2,481,900K – $1,044,200K)
= 3.04

The working capital turnover ratio for Perrigo Company PLC has exhibited fluctuations over the periods indicated. The trend indicates that for the most recent quarter of December 31, 2024, the working capital turnover stood at 3.04, suggesting that the company generated $3.04 in revenue for each dollar of working capital invested during that period. This ratio has shown variability, with values ranging from a low of 1.42 on March 31, 2022, to a high of 3.73 on December 31, 2023.

During the last few quarters, there seems to be a general improvement in the working capital turnover ratio after a decline from the highest point in December 31, 2023. This indicates that the efficiency of Perrigo Company PLC in utilizing its working capital to generate sales has experienced ups and downs. It is important to note that a higher working capital turnover ratio generally signifies improved efficiency in managing working capital, as the company is able to generate more revenue using less working capital.

However, the company should continue to monitor and manage its working capital effectively to ensure optimal performance and efficiency in its operations. Fluctuations in the working capital turnover ratio may be influenced by various factors such as changes in sales, inventory management, payment terms with suppliers, and overall operational efficiency. Analyzing these factors can provide insights into the company's financial health and operational effectiveness.