ResMed Inc (RMD)

Activity ratios

Short-term

Turnover ratios

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
Inventory turnover 3.71 3.65 3.24 3.02 2.77 2.59 2.48 2.73 3.14 3.48 3.78 4.30 4.56 3.78 3.48 3.01 2.97 3.40 3.13 3.22
Receivables turnover 5.59 5.81 6.09 6.23 5.92 5.92 5.68 5.95 6.33 7.09 6.68 5.94 5.32 5.99 6.14 6.55 6.23 5.21 5.27 5.47
Payables turnover 12.83 17.06 14.93 16.34 18.36 16.19 12.51 12.99 14.65 15.45 13.72 12.55 15.09 15.59 13.54 12.22 9.13 10.51 10.34 10.48
Working capital turnover 3.23 2.87 2.75 2.81 2.59 2.58 2.40 2.75 2.94 3.48 3.79 3.55 4.93 5.33 3.58 3.20 3.21 3.15 3.48 4.42

ResMed Inc's inventory turnover ratio has shown a general increasing trend over the past few quarters, indicating that the company is managing its inventory more efficiently. The current ratio of 3.71 suggests that the company is able to turn over its inventory approximately 3.71 times during the period, which is a positive sign.

Additionally, the receivables turnover ratio has fluctuated slightly but remained relatively stable, with an average of 5.96 over the periods analyzed. This ratio indicates that ResMed Inc is efficient in collecting outstanding receivables from its customers, with around 5.96 collection cycles per year.

On the other hand, the payables turnover ratio has displayed some variability but generally stayed at elevated levels. The ratio of 12.83 indicates that the company is making payments to its suppliers approximately 12.83 times a year. This could imply that ResMed Inc is effectively managing its trade credit terms and optimizing its cash flow.

Lastly, the working capital turnover ratio has shown some fluctuation but has trended upwards overall. This ratio of 3.23 indicates that ResMed Inc is generating revenue approximately 3.23 times for every dollar of working capital invested. This suggests that the company is efficiently utilizing its working capital to generate sales.

In conclusion, ResMed Inc appears to be effectively managing its inventory, receivables, payables, and working capital to support its operational activities and drive revenue generation.

Average number of days

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
Days of inventory on hand (DOH) days 98.42 99.99 112.72 120.90 131.57 140.85 147.25 133.92 116.39 104.86 96.46 84.81 80.13 96.67 104.74 121.43 122.79 107.26 116.63 113.34
Days of sales outstanding (DSO) days 65.28 62.80 59.95 58.57 61.68 61.63 64.25 61.39 57.66 51.47 54.64 61.44 68.66 60.93 59.42 55.71 58.59 70.04 69.22 66.77
Number of days of payables days 28.46 21.39 24.45 22.34 19.88 22.55 29.18 28.10 24.92 23.62 26.61 29.08 24.20 23.41 26.95 29.87 39.99 34.73 35.29 34.84

ResMed Inc's activity ratios, specifically days of inventory on hand (DOH), days of sales outstanding (DSO), and number of days of payables, provide insights into the efficiency and effectiveness of the company's operational activities.

1. Days of Inventory on Hand (DOH): The trend in ResMed Inc's DOH indicates that the company has been gradually increasing the number of days it holds inventory before selling it. This suggests a potential inefficiency in managing inventory levels, which could tie up working capital and increase storage costs. However, it is important to note some fluctuation in the trend over time.

2. Days of Sales Outstanding (DSO): ResMed Inc's DSO has been relatively stable with some fluctuations observed. A lower DSO indicates that the company is collecting its accounts receivable more quickly, which is a positive sign of efficient credit and collection practices. However, there has been some variability in this ratio over the periods analyzed.

3. Number of Days of Payables: The trend in the number of days of payables shows that ResMed Inc has been keeping a moderate level of payables days, with some variability in the trend over time. A higher number of days of payables can indicate that the company is effectively managing its cash flow by delaying payments to suppliers. However, excessively long payables days may strain relationships with suppliers.

Overall, ResMed Inc's activity ratios suggest a need for closer monitoring of inventory management to improve efficiency and reduce holding costs. The stability in DSO and moderate payables days indicate effective management of accounts receivable and payables, respectively, although some variability in these ratios should be further analyzed to assess potential impacts on cash flow and working capital.

Long-term

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
Fixed asset turnover 8.54 8.39 8.05 8.08 7.76 7.69 7.31 7.57 7.32 7.03 7.35 7.32 7.05 6.91 6.81 7.17 7.09 7.28 6.82 7.05
Total asset turnover 0.68 0.66 0.64 0.64 0.62 0.61 0.57 0.71 0.72 0.74 0.74 0.72 0.69 0.69 0.68 0.66 0.64 0.64 0.64 0.65

The fixed asset turnover ratio for ResMed Inc has shown a consistent upward trend over the past few quarters, indicating that the company is generating more sales relative to its investment in fixed assets. This suggests that ResMed is effectively utilizing its fixed assets to generate revenue.

On the other hand, the total asset turnover ratio has fluctuated slightly but generally remained within a relatively narrow range. This ratio measures the company's ability to generate sales from its total assets, including both fixed and current assets. While the total asset turnover ratio is lower than the fixed asset turnover ratio, it may suggest that ResMed could improve its efficiency in utilizing its total assets to generate revenue.

Overall, the trends in both fixed asset turnover and total asset turnover ratios indicate that ResMed Inc has been managing its assets efficiently to generate sales, though there may be opportunities for further improvement in maximizing the utilization of its total asset base for revenue generation.