Vir Biotechnology Inc (VIR)

Working capital turnover

		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
Revenue (ttm)	US$ in thousands	86,180	118,803	490,721	444,237	1,613,740	2,377,077	2,106,136	2,325,891	1,095,407	284,394	182,706	72,626	76,368	75,614	75,089
Total current assets	US$ in thousands	1,588,230	1,769,180	1,946,330	2,358,630	2,519,080	2,413,620	2,288,270	2,567,550	1,562,820	1,066,340	862,295	993,114	772,365	849,572	578,761	377,541	402,995	337,720
Total current liabilities	US$ in thousands	175,407	165,050	225,623	485,288	511,029	308,203	477,868	702,361	341,242	233,724	146,024	361,099	99,064	76,998	54,940	56,396	59,206	44,316
Working capital turnover		0.06	0.07	0.29	0.24	0.80	1.13	1.16	1.25	0.90	0.34	0.26	0.11	0.11	0.10	0.14

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $86,180K ÷ ($1,588,230K – $175,407K)
= 0.06

The working capital turnover of Vir Biotechnology Inc over the past eight quarters has exhibited a declining trend from Q1 2022 to Q4 2023. This ratio measures the efficiency of the company in utilizing its working capital to generate revenue. A working capital turnover ratio of less than 1 indicates that the company's working capital is not being efficiently utilized to support sales.

The decreasing trend in the working capital turnover from 1.25 in Q1 2022 to 0.06 in Q4 2023 suggests that Vir Biotechnology Inc may be experiencing challenges in effectively managing its working capital to support its revenue generation activities. This decline could be a red flag for potential liquidity issues or inefficiencies in the company's operations.

It is important for Vir Biotechnology Inc to closely monitor its working capital turnover and take appropriate measures to improve this ratio, such as optimizing inventory levels, managing accounts receivable and accounts payable efficiently, and streamlining its operational processes. By enhancing the efficiency of its working capital utilization, the company can potentially improve its financial performance and overall liquidity position.