Planet Fitness Inc (PLNT)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 197,122 | 190,026 | 177,200 | 258,333 | 193,372 |
| Payables | US$ in thousands | 32,887 | 23,788 | 20,578 | 27,892 | 19,388 |
| Payables turnover | 5.99 | 7.99 | 8.61 | 9.26 | 9.97 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $197,122K ÷ $32,887K
= 5.99
Planet Fitness Inc's payables turnover has shown a decreasing trend over the past five years, declining from 9.97 in December 31, 2020, to 5.99 in December 31, 2024. This indicates that the company is taking longer to pay its suppliers or vendors. A decreasing payables turnover ratio may suggest that the company is facing challenges in managing its accounts payable effectively or that it is stretching out payments to improve cash flow or liquidity. It could also indicate a deterioration in supplier relationships if payments are consistently delayed.
It is important for Planet Fitness Inc to closely monitor its payables turnover ratio, as a declining ratio may impact its relationships with suppliers and could lead to potential supply chain disruptions if vendors become dissatisfied. The company should assess its accounts payable processes and work towards improving payment efficiency to maintain good relationships with suppliers and ensure the smooth functioning of its operations.