Biogen Inc (BIIB)

Payables turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	5,130,800	5,542,500	5,059,300	5,665,300	1,805,200
Payables	US$ in thousands	424,200	403,300	491,500	589,200	454,900
Payables turnover		12.10	13.74	10.29	9.62	3.97

December 31, 2024 calculation

Payables turnover = Cost of revenue ÷ Payables
= $5,130,800K ÷ $424,200K
= 12.10

The payables turnover ratio for Biogen Inc has shown significant improvement over the years.

In December 31, 2020, the payables turnover ratio was at 3.97 indicating that the company took approximately 3.97 times to pay off its accounts payable during that period.

By December 31, 2021, the ratio increased to 9.62, reflecting a more efficient management of accounts payable. This improvement continued into December 31, 2022, with the ratio further increasing to 10.29, suggesting that Biogen Inc was paying off its suppliers at a faster rate.

The trend of improvement continued in the following years, with the payables turnover ratio reaching 13.74 by December 31, 2023. This sharp increase indicates that the company was managing its payables outstanding more effectively.

However, there was a slight decrease to 12.10 by December 31, 2024. While the ratio decreased compared to the previous year, it still remained at a relatively high level, signifying efficient management of accounts payable.

Overall, the increasing trend in the payables turnover ratio for Biogen Inc from 2020 to 2023 reflects the company's ability to effectively manage its payments to suppliers, resulting in better liquidity and working capital management. Additionally, the subsequent decrease in 2024, while not alarming, may warrant further investigation to ensure sustainable financial health.