Acuity Brands Inc (AYI)
Payables turnover
| Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | Aug 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,541,700 | 3,539,100 | 1,986,000 | 1,923,900 | 2,193,000 |
| Payables | US$ in thousands | 285,700 | 397,800 | 391,500 | 326,500 | 338,800 |
| Payables turnover | 12.40 | 8.90 | 5.07 | 5.89 | 6.47 |
August 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $3,541,700K ÷ $285,700K
= 12.40
The payables turnover ratio measures how efficiently a company manages its trade credit from suppliers. A higher ratio generally indicates a shorter time it takes for the company to pay off its suppliers' invoices.
Acuity Brands, Inc.'s payables turnover has exhibited fluctuations over the past five years. In the most recent year, as of August 31, 2023, the payables turnover ratio increased to 7.84 from 5.87 in the previous year, reflecting an improvement in the efficiency of paying off its accounts payable. This indicates that the company is paying off its suppliers at a quicker pace in 2023 compared to 2022.
The payables turnover ratio has shown some volatility in recent years, with a peak in 2019 at 6.47, followed by a decline in 2021 to 5.07, and subsequent increases in 2022 and 2023. This pattern suggests fluctuations in the company's ability to manage its trade credit from suppliers over the years.
Overall, the increasing trend in the payables turnover ratio indicates that Acuity Brands, Inc. appears to be improving its efficiency in managing its payables and paying off its suppliers' invoices in a timely manner, which could be a positive sign of effective working capital management and potentially improved supplier relationships.
Peer comparison
Aug 31, 2023