Chart Industries Inc (GTLS)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,069,700 | 1,537,700 | 1,279,800 | 1,138,300 | 1,278,500 |
| Payables | US$ in thousands | 811,000 | 211,100 | 175,900 | 140,100 | 120,800 |
| Payables turnover | 3.79 | 7.28 | 7.28 | 8.12 | 10.58 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $3,069,700K ÷ $811,000K
= 3.79
The payables turnover ratio measures how efficiently a company pays its suppliers. A higher payables turnover ratio indicates that the company is paying its suppliers more quickly.
Analyzing Chart Industries Inc's payables turnover ratio over the past five years, we observe a decreasing trend from 7.70 in 2019 to 2.85 in 2023. This suggests that the company has slowed down its payment to suppliers over the years.
A decreasing payables turnover ratio may indicate that the company is taking longer to pay its suppliers, which could be due to various factors such as cash flow constraints, renegotiation of payment terms, or changes in the company's purchasing strategy.
It is important to further investigate the reasons behind this decline in the payables turnover ratio to understand the company's liquidity management and supplier relationships. Additionally, comparing this ratio to industry benchmarks and peers can provide valuable insights into Chart Industries Inc's payment practices and financial performance.