Fortrea Holdings Inc. (FTRE)

Payables turnover

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024
Cost of revenue (ttm) US$ in thousands 2,859,000 2,889,400 2,959,100 3,006,300
Payables US$ in thousands 138,200 137,600 144,200 131,300
Payables turnover 20.69 21.00 20.52 22.90

December 31, 2024 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $2,859,000K ÷ $138,200K
= 20.69

To analyze Fortrea Holdings Inc.'s payables turnover, we examine the data provided for the fiscal year 2024:

- March 31, 2024: Payables turnover ratio was 22.90
- June 30, 2024: Payables turnover ratio was 20.52
- September 30, 2024: Payables turnover ratio was 21.00
- December 31, 2024: Payables turnover ratio was 20.69

The payables turnover ratio indicates the efficiency with which a company pays its suppliers. A higher ratio suggests that the company is paying its creditors more frequently within a year.

We observe some fluctuation in Fortrea Holdings Inc.'s payables turnover ratio throughout the year. The ratios range between 20.52 to 22.90, indicating variations in the company's payment practices. A consistent or increasing trend in the payables turnover ratio may suggest that the company is managing its payables effectively, negotiating better terms with suppliers, or experiencing growth in its operations.

However, a declining trend in the payables turnover ratio could indicate potential liquidity issues or inefficiencies in managing payables. It is essential to compare Fortrea Holdings Inc.'s payables turnover ratio with industry peers or historical data to gain better insights into its performance and financial health.

In conclusion, Fortrea Holdings Inc.'s payables turnover ratio fluctuated during the fiscal year 2024, and further analysis considering industry benchmarks and historical data is recommended to provide a more comprehensive evaluation of the company's payables management.