McCormick & Company Incorporated (MKC)
Payables turnover
| Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 4,132,700 | 4,108,400 | 4,140,400 | 4,160,500 | 4,159,700 | 4,179,500 | 4,146,500 | 4,116,600 | 4,076,000 | 4,032,100 | 3,953,000 | 3,881,300 | 3,823,300 | 3,693,100 | 3,583,300 | 3,462,800 | 3,300,900 | 3,258,500 | 3,207,800 | 3,179,600 |
| Payables | US$ in thousands | 1,238,100 | 1,227,800 | 1,210,300 | 1,133,300 | 1,119,300 | 1,099,900 | 1,100,000 | 1,124,300 | 1,171,000 | 1,143,500 | 1,126,400 | 1,072,600 | 1,064,200 | 1,023,100 | 1,040,500 | 967,400 | 1,032,300 | 902,800 | 857,200 | 789,400 |
| Payables turnover | 3.34 | 3.35 | 3.42 | 3.67 | 3.72 | 3.80 | 3.77 | 3.66 | 3.48 | 3.53 | 3.51 | 3.62 | 3.59 | 3.61 | 3.44 | 3.58 | 3.20 | 3.61 | 3.74 | 4.03 |
November 30, 2024 calculation
Payables turnover = Cost of revenue (ttm) ÷ Payables
= $4,132,700K ÷ $1,238,100K
= 3.34
McCormick & Company Incorporated's payables turnover ratio provides insight into how efficiently the company is managing its accounts payable. The payables turnover ratio is calculated by dividing the total purchases by the average accounts payable balance for a given period.
Based on the data provided, McCormick & Company's payables turnover ratio fluctuated over the observed period. The payables turnover ratio ranged from a low of 3.20 in November 2020 to a high of 3.80 in August 2023. A higher payables turnover ratio indicates that the company is paying off its suppliers more frequently, which could suggest efficient management of its payables.
Overall, McCormick & Company's payables turnover ratio has shown some variability but seems to have stabilized around 3.5 in recent periods. This implies that the company is effectively managing its accounts payable and maintaining a consistent payment schedule to suppliers. However, it is important to consider industry benchmarks and trends to assess whether McCormick's payables turnover ratio is in line with industry standards.