PriceSmart Inc (PSMT)
Payables turnover
| Aug 31, 2024 | Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 622,842 | 565,367 | 512,959 | 487,041 | 3,207,140 |
| Payables | US$ in thousands | 485,961 | 453,229 | 408,407 | 388,791 | 373,172 |
| Payables turnover | 1.28 | 1.25 | 1.26 | 1.25 | 8.59 |
August 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $622,842K ÷ $485,961K
= 1.28
The payables turnover ratio measures how efficiently a company is managing its accounts payable by calculating how many times the company pays off its suppliers during a specific period.
Based on the data provided, PriceSmart Inc's payables turnover ratio has been relatively consistent over the past five years, fluctuating between 1.25 and 1.28, except for a significant increase to 8.59 in 2020.
The consistency in the payables turnover ratio indicates that PriceSmart Inc has maintained a stable relationship with its suppliers in terms of payment frequency. However, the spike in the ratio in 2020 suggests a potential anomaly or significant change in the company's payables management during that year.
Further investigation into the reasons behind the spike in 2020 and whether it was an isolated event or part of a strategic shift in the company's payment practices would be necessary to fully interpret the implications of PriceSmart Inc's payables turnover ratios.
Peer comparison
Aug 31, 2024