MDU Resources Group Inc (MDU)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	2,991,870	5,007,040	4,104,940	4,058,930	3,917,480
Payables	US$ in thousands	475,215	525,560	478,933	426,264	403,391
Payables turnover		6.30	9.53	8.57	9.52	9.71

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $2,991,870K ÷ $475,215K
= 6.30

MDU Resources Group Inc's payables turnover has shown an increasing trend over the past five years, indicating an improvement in the efficiency of managing its accounts payable. The payables turnover ratio increased from 1.26 in 2019 to 1.79 in 2023. This suggests that the company is taking longer to pay its suppliers, which can be a sign of better cash flow management or improved negotiation terms with vendors.

A higher payables turnover ratio generally indicates that the company is better at managing its accounts payable, effectively utilizing trade credit, and optimizing its working capital. It implies that MDU Resources Group Inc is paying off its suppliers more quickly or efficiently relative to its purchases, which can have a positive impact on cash flow and liquidity.

Overall, the improving trend in payables turnover reflects positively on the company's ability to manage its financial obligations to suppliers and suggests a more efficient use of resources in its operations.