Neogen Corporation (NEOG)

Payables turnover

May 31, 2025 May 31, 2024 May 31, 2023 May 31, 2022 May 31, 2021
Cost of revenue US$ in thousands 473,285 460,322 416,492 284,146 253,403
Payables US$ in thousands 79,605 83,061 76,669 34,614 23,900
Payables turnover 5.95 5.54 5.43 8.21 10.60

May 31, 2025 calculation

Payables turnover = Cost of revenue ÷ Payables
= $473,285K ÷ $79,605K
= 5.95

The payables turnover ratio for Neogen Corporation has demonstrated a consistent downward trend over the specified period from May 31, 2021, to May 31, 2025. Specifically, the ratio declined from 10.60 times in 2021 to 8.21 times in 2022, indicating a decrease in the rate at which the company is settling its accounts payable relative to its purchases or cost of goods sold. This decline continued in 2023, reaching a ratio of 5.43, reflecting a significant reduction in payables turnover over this two-year span. In the subsequent years, the ratio showed a slight rebound, increasing marginally to 5.54 in 2024 and further to 5.95 in 2025.

This pattern suggests that Neogen Corporation has been taking longer to pay its suppliers over time, as evidenced by the decreasing turnover ratio, which possibly reflects a strategic shift in its cash management practices or changes in its credit terms. The slight increases in 2024 and 2025 could indicate an easing of this trend or improved liquidity management, but the overall level remains markedly lower than in 2021. Such shifts could have implications for the company's supplier relations, credit risk profile, and overall working capital management.


Peer comparison

May 31, 2025