United Therapeutics Corporation (UTHR)

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 2,877,400 2,756,200 2,616,700 2,498,300 2,327,500 2,204,300 2,110,900 1,981,300 1,936,300 1,860,000 1,788,700 1,768,300 1,685,500 1,655,200 1,590,600 1,506,100 1,483,300 1,409,500 1,430,900 1,442,500
Total current assets US$ in thousands 3,873,900 4,000,400 3,619,500 3,248,700 3,551,000 3,458,900 3,213,400 3,193,000 3,380,300 3,056,400 2,684,300 2,586,600 2,323,600 2,385,900 2,317,900 2,014,300 2,167,200 1,868,200 1,894,400 1,846,300
Total current liabilities US$ in thousands 738,100 873,400 832,300 860,600 804,400 744,100 370,300 324,600 343,200 315,900 331,500 292,600 305,400 320,000 311,400 302,400 323,300 258,900 255,000 207,300
Working capital turnover 0.92 0.88 0.94 1.05 0.85 0.81 0.74 0.69 0.64 0.68 0.76 0.77 0.84 0.80 0.79 0.88 0.80 0.88 0.87 0.88

December 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $2,877,400K ÷ ($3,873,900K – $738,100K)
= 0.92

United Therapeutics Corporation's working capital turnover has shown some fluctuations over the past few years. The ratio has ranged from a low of 0.64 to a high of 1.05. A working capital turnover ratio below 1 indicates that the company is not efficiently utilizing its working capital to generate sales. It implies that the company may have excess working capital that is not being effectively leveraged to drive revenue.

Looking at the trend, we observe that the working capital turnover ratio has generally been on a downward trajectory since March 31, 2023, hitting a low of 0.64 on December 31, 2022. However, there has been a recent increase in the ratio, with a significant improvement to 1.05 on March 31, 2024, which indicates that the company has become more efficient in generating sales relative to its working capital. This improvement could be a positive sign of better management of working capital and increased sales productivity.

Overall, it would be essential for United Therapeutics Corporation to sustain this upward trend in the working capital turnover ratio to ensure optimal utilization of working capital resources for revenue generation. Regular monitoring and strategic management of working capital will be crucial in maintaining operational efficiency and financial performance.