3M Company (MMM)
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 | 14,447,000 | 14,498,000 | 14,567,000 | 14,724,000 | 15,852,000 | 16,642,000 | 17,654,000 | 19,019,000 | 19,232,000 | 19,345,000 | 19,470,000 | 19,096,000 | 18,795,000 | 18,485,000 | 17,935,000 | 17,021,000 | 16,605,000 | 16,542,000 | 16,427,000 | 16,935,000 |
| Payables | US$ in thousands | 2,660,000 | 2,689,000 | 2,813,000 | 3,372,000 | 2,776,000 | 3,104,000 | 3,231,000 | 3,130,000 | 3,183,000 | 3,063,000 | 3,273,000 | 3,164,000 | 2,994,000 | 2,862,000 | 2,931,000 | 2,670,000 | 2,561,000 | 2,208,000 | 1,975,000 | 2,207,000 |
| Payables turnover | 5.43 | 5.39 | 5.18 | 4.37 | 5.71 | 5.36 | 5.46 | 6.08 | 6.04 | 6.32 | 5.95 | 6.04 | 6.28 | 6.46 | 6.12 | 6.37 | 6.48 | 7.49 | 8.32 | 7.67 |
December 31, 2024 calculation
Payables turnover = Cost of revenue (ttm) ÷ Payables
= $14,447,000K ÷ $2,660,000K
= 5.43
The payables turnover ratio for 3M Company has fluctuated over the given period, ranging from a high of 8.32 in June 2020 to a low of 4.37 in March 2024. This ratio measures how many times a company pays off its accounts payable during a specific period, indicating the efficiency of its payables management.
A higher payables turnover ratio suggests that the company is paying off its suppliers quickly, which could indicate good liquidity or strong negotiation power with suppliers. On the other hand, a lower ratio may indicate that the company is taking longer to pay its suppliers, which could be a result of cash flow constraints or lenient payment terms negotiated with suppliers.
Overall, the downward trend observed in the payables turnover ratio for 3M Company since June 2020 indicates a lengthening in the time taken to pay off its accounts payable. It would be important to further analyze the reasons behind this trend to understand its implications for the company's financial health and working capital management.
Peer comparison
Dec 31, 2024