General Dynamics Corporation (GD)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,290,000 | 3,295,000 | 3,135,000 | 3,070,000 | 35,531,000 |
| Payables | US$ in thousands | 3,095,000 | 3,398,000 | 3,167,000 | 2,952,000 | 3,162,000 |
| Payables turnover | 1.06 | 0.97 | 0.99 | 1.04 | 11.24 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $3,290,000K ÷ $3,095,000K
= 1.06
The payables turnover ratio measures how efficiently a company is managing its accounts payable by comparing its purchases to its average accounts payable balance during a specific period. A higher payables turnover indicates that the company is paying its suppliers more frequently and may have better negotiation terms.
General Dynamics Corp.'s payables turnover has been fluctuating over the past five years. In 2023, the payables turnover ratio increased to 11.50 from 9.65 in 2022, indicating that the company managed to pay its suppliers more frequently during the year. This improvement suggests that General Dynamics may have enhanced its supplier relations, negotiated better payment terms, or received discounts for early payments.
Comparing the 2023 payables turnover to the industry average or General Dynamics' historical performance would provide further context for this analysis. Investors and stakeholders should monitor this ratio over time to assess the company's ability to effectively manage its accounts payable and supplier relationships.
Peer comparison
Dec 31, 2023