FedEx Corporation (FDX)
Payables turnover
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 39,058,000 | 40,053,000 | 42,009,000 | 35,310,000 | 32,586,000 |
| Payables | US$ in thousands | 3,189,000 | 3,848,000 | 4,030,000 | 3,841,000 | 3,269,000 |
| Payables turnover | 12.25 | 10.41 | 10.42 | 9.19 | 9.97 |
May 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $39,058,000K ÷ $3,189,000K
= 12.25
The payables turnover ratio for FedEx Corporation has shown a positive trend over the past five years, indicating an improvement in the efficiency of managing its accounts payable.
In the fiscal year ending May 31, 2024, the payables turnover ratio stood at 12.25, which signifies that FedEx converted its accounts payable 12.25 times during the year. This represents an increase from the previous year's ratio of 10.41.
The increasing trend in the payables turnover ratio suggests that FedEx has been able to pay off its suppliers more frequently in recent years, either through improved cash flow management or negotiation of better payment terms.
Overall, a higher payables turnover ratio is generally considered positive as it indicates that a company is effectively managing its payables and maintaining good relationships with its suppliers. This trend bodes well for FedEx's financial health and operational efficiency.