Insteel Industries Inc (IIIN)
Payables turnover
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 479,566 | 583,790 | 629,522 | 469,053 | 416,831 |
| Payables | US$ in thousands | 37,487 | 34,346 | 46,796 | 49,443 | 38,961 |
| Payables turnover | 12.79 | 17.00 | 13.45 | 9.49 | 10.70 |
September 30, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $479,566K ÷ $37,487K
= 12.79
Insteel Industries Inc's payables turnover has fluctuated over the past five years, ranging from 9.49 to 17.00. The payables turnover ratio measures how efficiently the company is managing its trade payables by comparing the cost of goods sold to average accounts payable. A higher turnover ratio indicates that the company is paying its suppliers more frequently, which can be a positive sign of effective cash management.
In 2024, the payables turnover ratio dropped to 12.79 from the previous year's 17.00, suggesting a decrease in the rate at which the company is paying its suppliers. This could be due to various factors such as changes in payment terms, larger purchases on credit, or delays in supplier payments.
It is important for Insteel Industries Inc to closely monitor its payables turnover ratio to ensure that it strikes a balance between timely payments to suppliers and maintaining good relationships with them. A consistent and optimal payables turnover ratio can contribute to the company's overall financial health and liquidity.
Peer comparison
Sep 30, 2024