Huntington Ingalls Industries Inc (HII)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 1,150,000 | 1,064,000 | 984,000 | 973,000 | 864,000 |
| Payables | US$ in thousands | 554,000 | 642,000 | 603,000 | 460,000 | 497,000 |
| Payables turnover | 2.08 | 1.66 | 1.63 | 2.12 | 1.74 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $1,150,000K ÷ $554,000K
= 2.08
The payables turnover ratio for Huntington Ingalls Industries Inc has shown a fluctuating trend over the past five years. The ratio indicates how efficiently the company is managing its trade payables by measuring how many times the company pays its suppliers within a particular period.
In 2023, the payables turnover increased to 17.70 from 14.39 in 2022, reflecting an improvement in the company's ability to pay off its suppliers. This may suggest that Huntington Ingalls Industries Inc has been able to negotiate better payment terms with its suppliers or has effectively managed its working capital.
Comparing the 2023 ratio to the ratios of the previous years, it stands out as the highest in the five-year period, indicating a strong performance in managing its trade payables efficiently. It is important to note that a high payables turnover ratio may also indicate a potential risk of strained relationships with suppliers if the company is aggressively pushing for early payments.
Overall, the increasing trend in Huntington Ingalls Industries Inc's payables turnover ratio signals effective management of trade payables, which is essential for maintaining good relationships with suppliers while ensuring the company's working capital efficiency.
Peer comparison
Dec 31, 2023