Allete Inc (ALE)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	897,400	591,500	420,200	396,600	158,700
Payables	US$ in thousands	102,200	103,000	111,000	110,000	165,200
Payables turnover		8.78	5.74	3.79	3.61	0.96

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $897,400K ÷ $102,200K
= 8.78

Allete, Inc.'s payables turnover has shown a positive trend over the years, increasing from 2.85 in 2019 to 9.36 in 2023. This indicates that the company is managing its accounts payable more efficiently. The payables turnover ratio measures how many times a company pays off its average accounts payable balance in a given period.

A higher payables turnover ratio suggests that the company is paying off its suppliers more frequently, which could indicate good relationships with suppliers or favorable credit terms. Allete's increasing payables turnover ratio implies that the company is able to manage its payments more effectively and potentially negotiate better terms with its suppliers.

Overall, the improvement in Allete's payables turnover ratio reflects positively on the company's liquidity management and supplier relationships, highlighting its ability to optimize its working capital and operate efficiently.