Axalta Coating Systems Ltd (AXTA)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 4,527,600 | 4,564,600 | 4,082,000 | 3,545,100 | 4,145,100 |
| Payables | US$ in thousands | 724,900 | 733,500 | 657,400 | 564,400 | 483,700 |
| Payables turnover | 6.25 | 6.22 | 6.21 | 6.28 | 8.57 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $4,527,600K ÷ $724,900K
= 6.25
The payables turnover ratio for Axalta Coating Systems Ltd has been relatively stable over the past five years, ranging from 4.35 to 6.03. This ratio measures how efficiently the company is managing its accounts payable by calculating how many times a company pays off its average accounts payable balance within a specific period.
A higher payables turnover ratio indicates that the company is paying off its suppliers more frequently, which could suggest strong cash flow management or good relationships with suppliers. Conversely, a lower payables turnover ratio may indicate that the company is taking longer to pay its suppliers, potentially signaling liquidity issues or strained vendor relationships.
In the case of Axalta Coating Systems Ltd, the increasing trend in the payables turnover ratio from 2019 to 2020, followed by relatively stable levels in the subsequent years, suggests that the company has been effectively managing its accounts payable and maintaining consistent payment practices. However, further analysis would be necessary to understand the specific factors driving these trends and to assess the overall effectiveness of the company's payables management strategy.
Peer comparison
Dec 31, 2023