Keurig Dr Pepper Inc (KDP)

Payables turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	13,122,000	12,143,000	12,315,000	10,502,000	9,835,000
Payables	US$ in thousands	2,985,000	3,597,000	5,206,000	4,316,000	3,740,000
Payables turnover		4.40	3.38	2.37	2.43	2.63

December 31, 2024 calculation

Payables turnover = Cost of revenue ÷ Payables
= $13,122,000K ÷ $2,985,000K
= 4.40

The payables turnover ratio for Keurig Dr Pepper Inc has shown a generally decreasing trend from 2020 to 2022, indicating that the company took longer to pay off its accounts payable during this period. However, there was a sharp increase in the payables turnover ratio in 2023 and a substantial further improvement in 2024.

A payables turnover ratio of 2.63 in December 2020 means that the company's payables turnover cycle was approximately 2.63 times during that year. This decreased to 2.43 in December 2021 and further to 2.37 in December 2022. However, the ratio significantly improved to 3.38 in December 2023 and further to 4.40 in December 2024.

The increase in the payables turnover ratio in 2023 and 2024 suggests that Keurig Dr Pepper Inc has become more efficient in managing its accounts payable. A higher payables turnover ratio indicates that the company is taking less time to pay off its suppliers, which can be a positive sign of strong liquidity management. This improvement may result from better cash flow management, negotiation of favorable credit terms, or more efficient inventory turnover.

Overall, the trend in the payables turnover ratio for Keurig Dr Pepper Inc reflects a positive improvement in the company's ability to manage its payables efficiently, potentially leading to better working capital management and financial health.