Jabil Circuit Inc (JBL)

Payables turnover

		Aug 31, 2023	Aug 31, 2022	Aug 31, 2021	Aug 31, 2020	Aug 31, 2019
Cost of revenue	US$ in thousands	33,220,000	32,123,000	28,224,000	26,728,100	23,369,300
Payables	US$ in thousands	5,679,000	8,006,000	6,841,000	5,687,000	5,166,780
Payables turnover		5.85	4.01	4.13	4.70	4.52

August 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $33,220,000K ÷ $5,679,000K
= 5.85

The payables turnover ratio for Jabil Inc has shown fluctuations over the past five years. The ratio stood at 5.61 in 2023, indicating an improvement from the previous year. This suggests that Jabil Inc is paying off its suppliers at a faster rate compared to the prior year. However, it is essential to note that in 2022, the ratio decreased to 3.85, signifying a slower rate of paying off its payables compared to 2021.

Comparing the current ratio to 2021, when it was 3.94, and to 2020, when it was 4.45, it is evident that the company has made efforts to speed up its payables turnover in 2023. This could indicate a more efficient management of trade payables and stronger supplier relationships.

Despite the improvement in 2023, the payables turnover ratio still lags behind the level seen in 2019 when it stood at 4.52. This suggests that there may still be room for improvement in managing the company's payables. Overall, the trend in the payables turnover ratio reflects varying efficiency in managing payables over the past five years, with notable improvement in 2023 compared to the prior year.