Archer-Daniels-Midland Company (ADM)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 86,422,000 | 93,986,000 | 79,262,000 | 59,902,000 | 60,509,000 |
| Payables | US$ in thousands | 6,313,000 | 7,803,000 | 6,388,000 | 4,474,000 | 3,746,000 |
| Payables turnover | 13.69 | 12.04 | 12.41 | 13.39 | 16.15 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $86,422,000K ÷ $6,313,000K
= 13.69
Archer-Daniels-Midland Company's payables turnover ratio has shown a fluctuating trend over the past five years. The ratio decreased from 16.15 in 2019 to 13.39 in 2020, indicating a longer period to pay off its accounts payable. However, in the following years, the ratio increased to 12.41 in 2021, 12.04 in 2022, and further to 13.69 in 2023. This suggests that the company has been able to manage its payables more efficiently, taking less time to pay off its suppliers.
A payables turnover ratio of over 10 typically signifies that the company is paying its suppliers relatively quickly. Thus, the upward trend in the ratio over the past few years indicates that Archer-Daniels-Midland Company has been improving its ability to meet its payables obligations in a timely manner. However, a further analysis considering the industry standards and comparing it with the company's peers would provide a more comprehensive understanding of its payables management efficiency.
Peer comparison
Dec 31, 2023