Penske Automotive Group Inc (PAG)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	28,034,900	26,199,700	24,076,800	19,625,100	19,713,700
Payables	US$ in thousands	866,900	853,500	767,100	675,400	638,800
Payables turnover		32.34	30.70	31.39	29.06	30.86

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $28,034,900K ÷ $866,900K
= 32.34

Penske Automotive Group Inc's payables turnover ratio has shown a fluctuating trend over the past five years, ranging from 25.55 to 30.88. The payables turnover ratio indicates the efficiency with which the company manages its accounts payable by paying off its suppliers. A higher ratio suggests that the company is paying its suppliers more frequently within a shorter time period.

The highest payables turnover ratio of 30.88 was observed in 2019, indicating that the company was managing its payables efficiently by paying its suppliers more frequently. However, there was a decrease in this ratio in the following years, reaching a low of 25.55 in 2020. This decrease may suggest that Penske Automotive Group Inc took longer to pay off its suppliers during this period, potentially impacting relationships with suppliers.

In 2021, the payables turnover ratio increased to 27.52, showing a slight improvement in the company's payables management compared to the previous year. The ratio continued to increase in 2022 to 26.92, indicating further progress in paying off suppliers more efficiently. Finally, in 2023, the payables turnover ratio reached 28.37, showing a continued improvement in managing payables efficiently.

Overall, while there have been fluctuations in Penske Automotive Group Inc's payables turnover ratio over the past five years, the general trend has shown improvement in the company's ability to manage its accounts payable by paying off suppliers more efficiently in recent years.