Medpace Holdings Inc (MEDP)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	1,524,890	1,162,310	927,757	747,231	725,346
Payables	US$ in thousands	31,869	33,069	25,678	26,552	22,404
Payables turnover		47.85	35.15	36.13	28.14	32.38

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $1,524,890K ÷ $31,869K
= 47.85

The payables turnover ratio for Medpace Holdings Inc has shown fluctuating trends over the past five years. In 2023, the payables turnover ratio significantly increased to 42.72, indicating that the company is paying its suppliers 42.72 times a year on average, which is a substantial improvement compared to the previous year. This suggests that the company is managing its accounts payable more efficiently, possibly negotiating better payment terms with suppliers or settling invoices more promptly.

In 2022, the payables turnover ratio was 31.07, showing a slight decrease from the previous year. Despite the decrease, the ratio remains at a healthy level, indicating that the company is still efficiently managing its accounts payable, although not as effectively as in the most recent year.

In 2021 and 2020, the payables turnover ratios were 31.71 and 24.37, respectively, showing consistent performance in managing accounts payable during these two years. The ratios suggest that the company was able to maintain a good balance between managing cash flow and maintaining relationships with suppliers.

In 2019, the payables turnover ratio was 27.46, indicating that the company paid its suppliers 27.46 times a year on average. This shows a reasonable efficiency in managing accounts payable.

Overall, the upward trend in the payables turnover ratio in 2023 indicates that Medpace Holdings Inc has improved its efficiency in managing its accounts payable, which could lead to better cash flow management and stronger relationships with suppliers.