Addus HomeCare Corporation (ADUS)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 1,059,080 | 967,708 | 883,557 | 798,563 | 720,268 |
| Payables | US$ in thousands | 27,176 | 26,183 | 22,092 | 19,358 | 23,705 |
| Payables turnover | 38.97 | 36.96 | 39.99 | 41.25 | 30.38 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $1,059,080K ÷ $27,176K
= 38.97
Addus HomeCare Corporation's payables turnover has exhibited a consistent upward trend over the past five years, indicating improvements in the efficiency of managing its accounts payable. The ratio has increased from 30.38 in December 31, 2020, to 38.97 in December 31, 2024. This signifies that the company is paying its suppliers more frequently relative to the level of its accounts payable balance.
The peak payables turnover of 41.25 was recorded on December 31, 2021, suggesting an even higher rate of paying off suppliers during that period. While there was a slight dip in the ratio in 2023 to 36.96, it rebounded in 2024.
A higher payables turnover ratio typically indicates that a company is managing its trade credit effectively and maintaining good relationships with its suppliers. It may also suggest that Addus HomeCare Corporation is taking advantage of early payment discounts or negotiating favorable credit terms with its suppliers.
Overall, the trend of increasing payables turnover for Addus HomeCare Corporation is a positive sign of efficient working capital management and financial health.
Peer comparison
Dec 31, 2024