Organon & Co (OGN)
Receivables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|
| Revenue | US$ in thousands | 6,263,000 | 6,174,000 | 6,304,000 |
| Receivables | US$ in thousands | 1,744,000 | 1,475,000 | 1,382,000 |
| Receivables turnover | 3.59 | 4.19 | 4.56 |
December 31, 2023 calculation
Receivables turnover = Revenue ÷ Receivables
= $6,263,000K ÷ $1,744,000K
= 3.59
The receivables turnover ratio for Organon & Co. has shown a decreasing trend over the past five years. In 2023, the ratio stands at 3.59, a decrease from 4.19 in 2022, which was also lower than the 4.56 recorded in 2021. This decline indicates that the company is collecting its accounts receivable less frequently compared to previous years.
A lower receivables turnover ratio may suggest that Organon & Co. is taking longer to collect payments from its customers, which could potentially signal issues with credit policies, collection practices, or the creditworthiness of customers.
It is important for Organon & Co. to closely monitor this trend and take appropriate measures to improve the efficiency of its accounts receivable management, such as tightening credit terms, enhancing collection procedures, or reassessing the credit risk of customers. Failure to address this declining trend could lead to liquidity issues and impact the company's overall financial health.
Peer comparison
Dec 31, 2023