H B Fuller Company (FUL)
Payables turnover
| Dec 2, 2023 | Dec 3, 2022 | Nov 27, 2021 | Nov 28, 2020 | Nov 30, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,502,040 | 2,785,480 | 2,432,710 | 2,033,620 | 2,090,080 |
| Payables | US$ in thousands | 439,700 | 460,669 | 500,321 | 316,460 | 298,869 |
| Payables turnover | 5.69 | 6.05 | 4.86 | 6.43 | 6.99 |
December 2, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $2,502,040K ÷ $439,700K
= 5.69
The payables turnover ratio measures how efficiently a company manages its accounts payable. It is calculated by dividing the cost of goods sold by the average accounts payable for a specific period. A higher payables turnover ratio indicates that the company is paying its suppliers more frequently.
Looking at H.B. Fuller Company's payables turnover over the past five years, we can observe the following trends:
- In December 2023, the payables turnover ratio was 5.69, which represents a decrease from the previous year. This suggests that the company took longer to pay its suppliers compared to the prior year.
- In December 2022, the ratio was 6.05, indicating a slight decrease from the previous year. The decrease could be attributed to changes in the company's payment terms or the timing of supplier invoices.
- In November 2021, the payables turnover was 4.86, a decrease from the prior year. This suggests that the company took longer to pay its suppliers in comparison to the previous year.
- In November 2020, the ratio increased to 6.43, indicating an improvement in the company's ability to pay its suppliers. This could be a positive sign of effective accounts payable management.
- In November 2019, the payables turnover ratio was 6.99, showing a slight decrease from the previous year. This could indicate a change in the company's payment practices.
Overall, the fluctuation in H.B. Fuller Company's payables turnover ratio over the past five years may indicate changes in the company's payment policies, supplier relationships, or operational efficiency. It would be beneficial to further analyze the company's financial statements and disclosures to understand the underlying factors contributing to these fluctuations.