Omnicom Group Inc (OMC)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 13,472,300 | 12,779,000 | 12,205,800 | 12,091,500 | 11,854,100 |
| Payables | US$ in thousands | 12,484,400 | 11,634,000 | 11,000,200 | 11,897,200 | 11,513,000 |
| Payables turnover | 1.08 | 1.10 | 1.11 | 1.02 | 1.03 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $13,472,300K ÷ $12,484,400K
= 1.08
The payables turnover ratio for Omnicom Group Inc has fluctuated over the past five years. It was 1.03 in December 2020, decreased slightly to 1.02 in December 2021, then increased to 1.11 in December 2022, followed by a slight decrease to 1.10 in December 2023, and finally settled at 1.08 in December 2024.
A payables turnover ratio represents how efficiently a company manages its payments to suppliers. A higher ratio indicates that the company is paying its suppliers more frequently within a given period, which could imply good relationships with suppliers or effective working capital management. Conversely, a lower ratio may suggest that the company is taking longer to pay its suppliers, which could potentially strain supplier relationships or indicate inefficiencies in the company's payment processes.
In Omnicom Group Inc's case, the fluctuations in the payables turnover ratio suggest variations in the company's payment practices over the years. It is important for stakeholders to monitor these changes to understand how the company is managing its accounts payable and its impact on liquidity and supplier relationships.
Peer comparison
Dec 31, 2024