Healthcare Services Group Inc (HCSG)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 1,633,720 | 1,640,920 | 1,592,590 | 1,647,300 | 1,767,100 |
| Payables | US$ in thousands | 83,224 | 68,296 | 64,419 | 52,239 | 54,418 |
| Payables turnover | 19.63 | 24.03 | 24.72 | 31.53 | 32.47 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $1,633,720K ÷ $83,224K
= 19.63
The payables turnover ratio for Healthcare Services Group, Inc. has shown a decreasing trend over the past five years. In 2019 and 2020, the company had relatively high payables turnover ratios of 29.64 and 28.57, respectively. However, in the subsequent years, the payables turnover ratio decreased to 21.97 in 2021, 21.91 in 2022, and 17.50 in 2023.
A decreasing payables turnover ratio may suggest that the company is taking longer to pay its suppliers, which could potentially strain its relationships with vendors. It may also indicate inefficiencies in managing accounts payable or a decrease in the volume of purchases on credit.
Further investigation into the underlying reasons for the declining trend in payables turnover could provide insights into the company's working capital management practices and its financial health.