ResMed Inc (RMD)
Working capital turnover
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 | Jun 30, 2020 | ||
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Revenue (ttm) | US$ in thousands | 5,021,540 | 4,926,780 | 4,807,490 | 4,546,017 | 4,444,877 | 4,364,797 | 4,235,737 | 4,222,994 | 4,015,671 | 3,763,271 | 3,624,405 | 3,578,126 | 3,539,492 | 3,443,759 | 3,348,896 | 3,196,825 | 3,091,065 | 3,091,753 | 3,027,899 | 2,957,011 |
Total current assets | US$ in thousands | 3,208,420 | 2,836,180 | 2,641,120 | 2,357,720 | 2,351,300 | 2,378,080 | 2,304,580 | 2,367,830 | 2,337,820 | 2,325,160 | 2,033,700 | 1,931,480 | 1,704,300 | 1,547,240 | 1,586,260 | 1,574,760 | 1,466,150 | 1,451,480 | 1,542,610 | 1,523,460 |
Total current liabilities | US$ in thousands | 940,516 | 851,960 | 904,079 | 910,655 | 773,030 | 764,073 | 770,802 | 758,533 | 761,691 | 732,714 | 692,659 | 689,299 | 667,265 | 621,064 | 624,158 | 911,766 | 876,541 | 577,335 | 590,853 | 602,761 |
Working capital turnover | 2.21 | 2.48 | 2.77 | 3.14 | 2.82 | 2.70 | 2.76 | 2.62 | 2.55 | 2.36 | 2.70 | 2.88 | 3.41 | 3.72 | 3.48 | 4.82 | 5.24 | 3.54 | 3.18 | 3.21 |
March 31, 2025 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $5,021,540K ÷ ($3,208,420K – $940,516K)
= 2.21
The analysis of ResMed Inc.'s working capital turnover over the period from June 2020 to March 2025 reveals notable fluctuations indicative of the company's operational and liquidity dynamics.
Initially, the ratio was relatively stable around 3.21 in June 2020 and 3.18 in September 2020. This stability was followed by a modest increase to 3.54 at the end of 2020, signaling a slight improvement in the efficiency with which the company utilized its working capital to generate sales.
A significant upward movement is evident in March 2021, where the ratio peaks at 5.24, representing a substantial increase in working capital efficiency. This peak suggests a period where the company maximized its utilization of working capital relative to its sales, possibly reflecting effective inventory management, receivables collection, or supplier negotiations.
Subsequently, the ratio declines to 4.82 in June 2021 and then drops further to 3.48 in September 2021, aligning closely with pre-peak levels. This decline indicates a reduction in working capital turnover efficiency, which could be due to increased working capital requirements, changes in sales, or shifts in operational efficiency.
From late 2021 onward, a downward trend is apparent, with the ratio decreasing to approximately 2.36 by the end of December 2022. This sustained decline suggests that the company's working capital is being used less efficiently relative to sales, potentially owing to increased investments in inventory or receivables, or a slowdown in sales growth.
In 2023, the ratio shows signs of stabilization around 2.55 in March, gradually increasing to 3.14 by June, then fluctuating mildly around 2.77 in September and 2.48 in December. These movements imply incremental improvements and stability in working capital management.
In the subsequent period through mid-2024, the ratio further rises to 3.14 in June before declining again slightly to 2.77 in September and 2.48 at the end of 2024. This suggests fluctuating operational efficiency but without returning to the peak levels observed in early 2021.
By March 2025, the ratio stands at approximately 2.21, indicating a continued decrease in working capital turnover efficiency relative to earlier years, though it remains relatively stable compared to the lowest points in late 2022.
Overall, the trend reflects periods of improved working capital utilization, notably in early 2021, followed by a consistent decline over the subsequent years, possibly reflecting changing business conditions, operational strategies, or industry dynamics impacting working capital management.
Peer comparison
Mar 31, 2025