Chevron Corp (CVX)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	126,915,000	152,093,000	95,720,000	60,352,000	96,726,000
Payables	US$ in thousands	20,423,000	18,955,000	16,454,000	10,950,000	14,103,000
Payables turnover		6.21	8.02	5.82	5.51	6.86

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $126,915,000K ÷ $20,423,000K
= 6.21

Chevron Corp.'s payables turnover has fluctuated over the past five years, as indicated by the data in the table. The payables turnover ratio measures how efficiently a company is managing its trade payables by comparing the cost of goods sold to average accounts payable.

In 2023, Chevron's payables turnover ratio was 5.84, showing a decrease from the prior year. This implies that the company took longer to pay off its suppliers and vendors compared to the previous year. A lower payables turnover ratio can indicate delays in payments, strained supplier relationships, or changes in payment terms.

In 2022, the payables turnover ratio was 7.67, reflecting a significant increase compared to the previous year. This suggests that Chevron was managing its payables more efficiently, possibly by negotiating better terms with suppliers or streamlining payment processes.

In 2021, the payables turnover ratio decreased to 5.43, indicating a decrease in efficiency in managing payables compared to the previous year. This could be attributed to various factors such as changes in procurement practices or supplier relationships.

In 2020, the payables turnover ratio was 4.61, showing an improvement in payables management efficiency compared to the prior year. A higher ratio indicates that Chevron was paying off its trade payables more quickly, which could be a sign of effective cash flow management.

In 2019, the payables turnover ratio was 5.68, reflecting a moderate efficiency in managing payables compared to the following years. The consistency in payables turnover ratio over the years can indicate a stable relationship with suppliers and consistent payment practices.

In conclusion, analyzing Chevron Corp.'s payables turnover ratios over the past five years provides insights into the company's efficiency in managing trade payables and its relationships with suppliers.