Quanex Building Products (NX)
Receivables turnover
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 1,130,580 | 1,221,500 | 1,072,150 | 851,573 | 893,841 |
| Receivables | US$ in thousands | 195,182 | 191,869 | 216,034 | 176,574 | 165,691 |
| Receivables turnover | 5.79 | 6.37 | 4.96 | 4.82 | 5.39 |
October 31, 2023 calculation
Receivables turnover = Revenue ÷ Receivables
= $1,130,580K ÷ $195,182K
= 5.79
The receivables turnover ratio measures how effectively a company is able to collect on its credit sales within a given period. A higher turnover ratio generally indicates that the company is collecting its receivables more efficiently.
Analyzing Quanex Building Products Corp's receivables turnover over the past five years reveals fluctuation in the efficiency of its receivables collection process.
In 2023, the receivables turnover ratio decreased to 10.71 from 12.72 in 2022. This decline may indicate that the company took longer to collect its receivables in 2023 compared to 2022. It's essential to investigate the reasons behind this decrease, such as changes in credit policies, customer payment behavior, or sales mix.
Comparing 2023 to 2021, when the ratio was 9.90, there seems to have been an improvement in the efficiency of receivables collection, as the turnover increased. However, it's important to consider the underlying factors driving this change to understand the overall health of the company's receivables management.
Looking back further, in 2020 and 2019, the ratios were 9.65 and 10.78, respectively. It's evident that the company's receivables turnover has fluctuated over the years, demonstrating variability in its ability to collect on credit sales.
Overall, while the receivables turnover ratio provides insight into the efficiency of Quanex Building Products Corp's collection efforts, a more in-depth analysis including a review of the company's credit policies, customer base, and economic conditions could provide a clearer understanding of the changes in the turnover ratio and the company's overall receivables management.
Peer comparison
Oct 31, 2023