Thus far, I have always tried to squash it into practical lessons. But this means that sometimes if there's a lot to get through the theory doesn't happen, or if it does I end up over-running; sometimes the students forget their theory books, or remember them but have forgotten to do the homework, and the whole scenario seems to cause lots of hassle, with their theory grades lagging behind the practical. Sometimes I think it might be better to have a separate theory lesson, or even a few coming together. What do other teachers do to manage the logistics of making time?

I use the workbooks by Nina Ng see here. They are bright and colourful and very appealing to children. Since introducing these, I find there has been a lot less 'forgetting' of theory books and homework. In a 45 minute lesson, I spend 5 - 10 minutes on theory and expect to tackle 2 - 3 pages a week. If there is an exam looming, I occasionally have an extra lesson on theory. So far, so good..

I've cut back on doing much by way of 'formal' theory. I cover the essentials through playing and looking at pieces mainly. Most of my students are not interested in either practical or theory exams and for those who are I work through a workbook at whatever pace the student wants for the most part.
If anybody decides that they do, after all, want to prepare for a theory exam we are likely to have covered a fair amount anyway.
I only did formal 'exam' theory when I decided to do grade 5 and as I'd picked up all the basics along the way going through the workbooks was mainly a formality so I think that learning through learning to play first makes understanding easier.
Of course there will always be the ones who put a lot of effort into NOT learning this way... or any other......but if the interest is that lacking then they probably don't really want to do the exams anway.

I don;t teach, I am an adult learner. My teacher splits my lessons and does 30 mins theory then 30 mins practice. I prefer theory first but she used to do it the other way round. Sometimes we do one lesson all theory, then the next one all practice, but I find an hour of playing too much to cope with!