General Mills Inc (GIS)
Payables turnover
| May 26, 2024 | May 28, 2023 | May 29, 2022 | May 30, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | -4,894,300 | -4,588,400 | -4,267,900 | -4,259,100 | -4,084,300 |
| Payables | US$ in thousands | 3,987,800 | 4,194,200 | 3,982,300 | 3,653,500 | 3,247,700 |
| Payables turnover | -1.23 | -1.09 | -1.07 | -1.17 | -1.26 |
May 26, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $-4,894,300K ÷ $3,987,800K
= -1.23
Based on the data provided for General Mills Inc, the payables turnover ratio has been consistently negative over the past five years. A negative payables turnover ratio indicates that the company is taking longer to pay its suppliers compared to the turnover of its accounts payable. This could be a potential concern as it may indicate inefficient management of payables and cash flow.
The decreasing trend in the payables turnover ratio from -1.26 in 2020 to -1.23 in 2024 suggests that General Mills Inc has been taking even longer to pay its suppliers in recent years. This trend could be a result of various factors such as changes in payment terms with suppliers, liquidity constraints, or possibly difficulties in managing working capital effectively.
Overall, a consistently negative payables turnover ratio for General Mills Inc raises questions about the company's payables management practices and its impact on cash flow. It may be beneficial for the company to reassess its payables process and work towards improving efficiency in managing its accounts payable to optimize its working capital management.
Peer comparison
May 26, 2024