Callaway Golf Company (MODG)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,569,300 | 1,114,400 | 1,045,700 | 882,499 | 1,738,030 |
| Payables | US$ in thousands | 96,400 | 130,700 | 159,100 | 138,700 | 66,282 |
| Payables turnover | 26.65 | 8.53 | 6.57 | 6.36 | 26.22 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $2,569,300K ÷ $96,400K
= 26.65
The payables turnover ratio for Callaway Golf Company has exhibited fluctuations over the years based on the provided data.
For the fiscal year ending December 31, 2020, the payables turnover ratio was 26.22, indicating that on average, the company paid off its accounts payable over 26 times during the year. This high ratio could suggest that Callaway Golf Company was efficient in managing its accounts payable and had a shorter payment period, potentially benefiting from discounts or better credit terms.
However, in the subsequent years, the payables turnover ratio decreased significantly. By December 31, 2021, the ratio dropped to 6.36, signaling a decline in the frequency of paying off accounts payable. This slowdown in payment turnover may imply that the company took longer to settle its payables, which could have various implications such as strained supplier relationships or missed opportunities for early payment discounts.
Although there was a slight increase in the payables turnover ratio to 6.57 by December 31, 2022, the ratio remained relatively low compared to the initial period. This continued low turnover suggests that Callaway Golf Company may still be taking longer to clear its accounts payable obligations, potentially impacting cash flow management and relationships with suppliers.
By December 31, 2023, there was a noticeable improvement in the payables turnover ratio, reaching 8.53. This uptick could indicate that the company started to enhance its accounts payable management, leading to a more frequent settlement of payables during the year.
Finally, for the most recent period ending December 31, 2024, the payables turnover ratio surged to 26.65, returning to a level similar to the initial period. This significant increase suggests that Callaway Golf Company improved its accounts payable management practices, potentially resulting in a shorter payment period and more efficient working capital utilization.
In summary, the payables turnover ratio for Callaway Golf Company has shown variability over the years, ranging from high efficiency to periods of slower payment turnover. Monitoring this ratio can provide insights into the company's liquidity, operational efficiency, and relationships with suppliers.
Peer comparison
Dec 31, 2024