PriceSmart Inc (PSMT)

Number of days of payables

		Aug 31, 2024	May 31, 2024	Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020	Feb 29, 2020	Nov 30, 2019
Payables turnover		1.28	1.24	1.17	1.11	1.25	1.32	1.32	1.16	1.26	1.29	1.32	1.08	1.25	3.02	3.01	2.60	2.66	3.48	3.50	2.97
Number of days of payables	days	284.78	293.26	312.44	328.67	292.60	277.17	276.74	313.42	290.61	282.95	276.07	338.30	291.37	120.92	121.41	140.26	137.24	104.85	104.14	123.10

August 31, 2024 calculation

Number of days of payables = 365 ÷ Payables turnover
= 365 ÷ 1.28
= 284.78

The number of days of payables for PriceSmart Inc has shown variability over time. In recent periods, the days of payables have been on the higher side, indicating that the company is taking longer to pay its suppliers. This could imply that PriceSmart Inc may be managing its working capital by stretching out its payment terms with suppliers.

Specifically, there was a significant increase in the number of days of payables from Nov 2021 to Feb 2023, where the company took more time to pay its suppliers. This trend continued until Aug 2024, with the number of days of payables ranging from 276 to 328 days, which is comparatively high.

However, there were instances in the past where the number of days of payables was much lower, such as in May 2021, where it was only 120.92 days. This could indicate more efficient management of payables during that period.

Overall, the increasing trend in the number of days of payables in recent periods suggests that PriceSmart Inc may be adopting a strategy to optimize its cash flow by delaying payments to suppliers. It is important for the company to strike a balance between managing working capital efficiently and maintaining good relationships with suppliers.