Magnolia Oil & Gas Corp (MGY)

Payables turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Cost of revenue (ttm)	US$ in thousands	95,463	93,399	90,738	85,707	81,141	78,443	78,636	78,419	75,671	73,957	69,542	83,605	89,554	96,614	102,380	89,804	1,989,136	1,987,576	1,988,151	1,990,149
Payables	US$ in thousands	181,073	164,295	226,930	219,604	193,212	183,341	166,234	190,808	202,846	214,609	186,844	134,652	127,909	107,460	92,134	74,125	62,626	63,475	64,534	86,154
Payables turnover		0.53	0.57	0.40	0.39	0.42	0.43	0.47	0.41	0.37	0.34	0.37	0.62	0.70	0.90	1.11	1.21	31.76	31.31	30.81	23.10

December 31, 2024 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $95,463K ÷ $181,073K
= 0.53

The payables turnover ratio for Magnolia Oil & Gas Corp has experienced a significant decline over the years based on the provided data. The payables turnover ratio measures how efficiently a company is managing its payable obligations by analyzing how many times a company pays its suppliers within a specific period.

From March 31, 2020, to June 30, 2020, there was a notable increase in the payables turnover ratio from 23.10 to 30.81. This indicates that Magnolia Oil & Gas Corp was managing its payables more effectively during that period. However, from June 30, 2020, onwards, there was a continuous decline in the payables turnover ratio, reaching a low of 0.34 on September 30, 2022, before slightly recovering to 0.53 by December 31, 2024.

Such a low payables turnover ratio may suggest that Magnolia Oil & Gas Corp is taking more time to pay its suppliers, which could potentially strain relationships with its vendors or jeopardize future credit terms. It could also indicate potential liquidity issues or inefficient management of working capital.

Overall, the declining trend in the payables turnover ratio for Magnolia Oil & Gas Corp raises concerns about its payables management efficiency and highlights the need for closer monitoring and potential strategic adjustments to enhance supplier relationships and optimize cash flows.