Alkermes Plc (ALKS)

Payables turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Cost of revenue (ttm)	US$ in thousands	891,670	688,546	721,001	768,818	770,818	985,525	952,143	892,530	860,255	863,254	846,075	830,095	796,512	771,471	756,781	741,926	756,643	571,378	591,872	616,264
Payables	US$ in thousands	45,630	37,037	104,747	77,052	65,649	87,036	84,616	37,147	32,843	33,199	40,047	27,697	55,721	36,875	32,798	36,097	46,034	82,835	50,944	43,177
Payables turnover		19.54	18.59	6.88	9.98	11.74	11.32	11.25	24.03	26.19	26.00	21.13	29.97	14.29	20.92	23.07	20.55	16.44	6.90	11.62	14.27

December 31, 2024 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $891,670K ÷ $45,630K
= 19.54

The payables turnover ratio measures how efficiently a company pays its suppliers. A higher ratio indicates that the company is paying its suppliers more quickly, which may signal strong liquidity or favorable credit terms.

Analyzing the data provided for Alkermes Plc's payables turnover, we can observe fluctuations in the ratio over the quarters. The ratio ranged from a low of 6.90 in September 2020 to a high of 29.97 in March 2022. Generally, a rising trend in payables turnover can indicate improving efficiency in managing payables.

However, it is important to note that a very high payables turnover ratio could also suggest that the company is not taking full advantage of the credit terms offered by suppliers, potentially impacting cash flow or relationships with suppliers. Conversely, a very low ratio may indicate liquidity issues or challenges in meeting payment obligations promptly.

In the context of Alkermes Plc, the payables turnover ratio fluctuated significantly over the quarters, implying changes in the company's payment practices and relationships with suppliers. Further analysis of the company's overall financial health, operational efficiency, and industry norms would provide a more comprehensive understanding of the implications of these fluctuations in the payables turnover ratio.