Aramark Holdings (ARMK)

Payables turnover

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Cost of revenue	US$ in thousands	18,178,700	15,307,300	11,563,300	12,732,600	15,336,200
Payables	US$ in thousands	1,271,860	1,322,940	919,090	663,455	999,517
Payables turnover		14.29	11.57	12.58	19.19	15.34

September 30, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $18,178,700K ÷ $1,271,860K
= 14.29

The payables turnover ratio measures how efficiently a company is managing its accounts payable by comparing the cost of goods sold to the average accounts payable balance. A higher payables turnover ratio typically indicates that a company is paying its suppliers more quickly.

Analyzing the payables turnover ratio of Aramark Holdings over the past five years, we can see fluctuations in the efficiency of their payables management. In 2023, the payables turnover ratio increased to 14.29 from 11.57 in the previous year, indicating that the company paid its suppliers more frequently during this period.

Comparing it to the ratio of 12.58 in 2021, the increase in 2023 suggests an improvement in managing accounts payable turnover. However, the payables turnover ratio in 2020 was significantly higher at 19.19, signifying that the company was settling its obligations to suppliers at a faster pace that year.

Overall, despite some variability, Aramark Holdings has generally maintained a moderate to high level of efficiency in managing its payables turnover in recent years. It is crucial for investors and stakeholders to monitor this ratio to assess the company's liquidity, vendor relationships, and operational efficiency.