Lennox International Inc (LII)
Number of days of payables
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Payables turnover | 7.28 | 9.16 | 8.04 | 7.48 | 7.62 | |
| Number of days of payables | days | 50.11 | 39.83 | 45.42 | 48.83 | 47.88 |
December 31, 2024 calculation
Number of days of payables = 365 ÷ Payables turnover
= 365 ÷ 7.28
= 50.11
To analyze Lennox International Inc's number of days of payables over the years based on the provided data:
1. The number of days of payables represents how long, on average, the company takes to pay its suppliers.
2. Lennox International Inc's number of days of payables has been fluctuating over the years:
- As of December 31, 2020, the company took approximately 47.88 days to pay its suppliers.
- By December 31, 2021, this figure increased slightly to 48.83 days, indicating a slightly longer payment period.
- The number of days of payables decreased to 45.42 days by December 31, 2022, suggesting improved efficiency in paying suppliers.
- A further decrease to 39.83 days by December 31, 2023, indicates a significant improvement in the company's payment cycle.
- However, by December 31, 2024, the number of days of payables increased to 50.11 days, reflecting a longer payment period compared to the previous year.
3. A decreasing trend in the number of days of payables implies a more efficient management of payables, allowing the company to hold onto cash longer before paying suppliers.
4. On the other hand, an increasing trend may indicate potential cash flow issues, strained supplier relationships, or changes in payment terms.
5. It is essential for Lennox International Inc to monitor its number of days of payables closely to ensure a balance between managing cash flow effectively and maintaining healthy supplier relations.
Peer comparison
Dec 31, 2024