Ironwood Pharmaceuticals Inc (IRWD)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 175,757 | 115,994 | 112,206 | 158,521 | 199,945 |
| Payables | US$ in thousands | 7,830 | 483 | 935 | 661 | 3,978 |
| Payables turnover | 22.45 | 240.15 | 120.01 | 239.82 | 50.26 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $175,757K ÷ $7,830K
= 22.45
The payables turnover ratio of Ironwood Pharmaceuticals Inc has been consistently low over the past five years, with a reading of 0.00 in each of the years 2023, 2022, and 2021. This indicates that the company is taking an extended time to pay its suppliers. In contrast, the payables turnover ratio was 4.74 in 2020 and 4.35 in 2019, suggesting that the company was more efficient in paying its payables in those years.
The declining trend in payables turnover could be a cause for concern as it may imply liquidity issues or strained relationships with suppliers. Further investigation into the company's payables management practices and supplier relationships is warranted to understand the causes behind the consistently low payables turnover ratio in recent years.
Peer comparison
Dec 31, 2023