Eastman Chemical Company (EMN)
Payables turnover
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 7,149,000 | 7,403,000 | 7,788,000 | 8,162,000 | 8,443,000 | 8,581,000 | 8,471,000 | 8,329,000 | 7,976,000 | 7,501,000 | 7,064,000 | 6,645,000 | 6,498,000 | 6,546,000 | 6,676,000 | 6,897,000 | 7,039,000 | 7,241,000 | 7,309,000 | 7,452,000 |
| Payables | US$ in thousands | 1,440,000 | — | — | — | 1,607,000 | 1,679,000 | 1,678,000 | 1,652,000 | 1,513,000 | 1,472,000 | 1,408,000 | 1,300,000 | 1,051,000 | 913,000 | 767,000 | 1,040,000 | 1,170,000 | 1,181,000 | 1,290,000 | 1,308,000 |
| Payables turnover | 4.96 | — | — | — | 5.25 | 5.11 | 5.05 | 5.04 | 5.27 | 5.10 | 5.02 | 5.11 | 6.18 | 7.17 | 8.70 | 6.63 | 6.02 | 6.13 | 5.67 | 5.70 |
December 31, 2023 calculation
Payables turnover = Cost of revenue (ttm) ÷ Payables
= $7,149,000K ÷ $1,440,000K
= 4.96
The payables turnover ratio measures how efficiently a company is managing its accounts payable by calculating how many times a company pays off its suppliers within a given period. A higher payables turnover ratio indicates that the company is paying off its suppliers more quickly.
Looking at the quarterly data for Eastman Chemical Co:
- In Q4 2023, the payables turnover ratio was 6.11, indicating that the company paid off its suppliers approximately 6.11 times during that quarter.
- This was a significant improvement compared to the previous quarter, Q3 2023, where the ratio was 3.82.
- However, when compared to the same quarter in the previous year, Q4 2022, the ratio was slightly lower at 6.40.
- Over the past eight quarters, the payables turnover ratio has shown some fluctuations but generally remained above 4, reflecting a consistent trend of managing payables efficiently.
Overall, the increasing trend in the payables turnover ratio for Eastman Chemical Co suggests improved efficiency in managing its accounts payable and indicates that the company is paying off its suppliers at a faster rate in more recent quarters. This trend is generally positive as it can lead to better relationships with suppliers and potentially lower costs for the company.
Peer comparison
Dec 31, 2023