Adtalem Global Education Inc (ATGE)

Payables turnover

		Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Cost of revenue	US$ in thousands	719,413	698,548	648,486	659,776	489,233
Payables	US$ in thousands	105,017	102,626	81,812	57,140	42,421
Payables turnover		6.85	6.81	7.93	11.55	11.53

June 30, 2025 calculation

Payables turnover = Cost of revenue ÷ Payables
= $719,413K ÷ $105,017K
= 6.85

The payables turnover ratio for Adtalem Global Education Inc exhibits notable fluctuations over the analyzed period from June 30, 2021, to June 30, 2025.

In fiscal year 2021, the ratio stood at 11.53, indicating that the company settled its accounts payable approximately 11.5 times within the year. This high turnover suggests efficient management of short-term liabilities and prompt payment practices. The ratio remained relatively stable in 2022, with a marginal increase to 11.55, continuing to reflect a consistent approach towards managing payables.

However, a significant decline is observed in fiscal year 2023, when the ratio decreased to 7.93. This reduction signifies a decrease in the frequency of paying off accounts payable, implying either a lengthening of payment terms with suppliers or potential liquidity considerations impacting the company's ability to settle payables as quickly as in previous years.

The downward trend persists into 2024, with the ratio further declining to 6.81. This continued decline indicates a further extension of the period over which payables are settled, which may reflect changes in supplier negotiations, shifts in cash flow management, or strategic adjustments in working capital policies.

By the fiscal year ending June 30, 2025, the ratio increases slightly to 6.85, marginally surpassing the 2024 figure. Although this represents a small uptick, the overall level of payables turnover remains considerably lower than in 2021 and 2022, suggesting that the company’s payables management continues to involve longer payment cycles compared to prior years.

Overall, the trend in Adtalem Global Education Inc’s payables turnover ratio indicates a shift towards lengthening the time taken to pay suppliers over the analyzed period. This change could be attributable to strategic efforts to optimize liquidity, renegotiate payment terms, or respond to external financial conditions. The consistent decrease from nearly 11.5 in 2021 to below 7 in 2023 and beyond reflects a notable change in the company's payables management strategy or financial environment.