PriceSmart Inc (PSMT)

Payables turnover

		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
Cost of revenue (ttm)	US$ in thousands	622,842	611,361	592,389	580,323	565,367	549,414	536,255	520,062	512,959	507,649	503,446	497,434	487,041	1,029,319	1,009,612	999,539	992,443	985,307	985,230	974,260
Payables	US$ in thousands	485,961	491,203	507,077	522,568	453,229	417,210	406,581	446,572	408,407	393,536	380,778	461,046	388,791	341,007	335,821	384,086	373,172	283,045	281,098	328,585
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

August 31, 2024 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $622,842K ÷ $485,961K
= 1.28

The payables turnover ratio for PriceSmart Inc has fluctuated over the past few years, with values ranging from 1.08 to 3.50. The payables turnover ratio measures how efficiently a company is managing its accounts payable by indicating how many times during a period the company pays off its average accounts payable balance.

The trend in PriceSmart Inc's payables turnover ratio shows some inconsistency, with variations between periods. Generally, a higher payables turnover ratio indicates that the company is paying off its suppliers more quickly, which could imply strong liquidity or efficient management of trade credit. Conversely, a lower ratio may suggest a longer payment period or potential liquidity issues.

It would be useful to compare PriceSmart Inc's payables turnover ratio with industry peers or previous performance to gain further insights into the company's payment practices and financial management. Additionally, a detailed analysis of the underlying factors influencing the payables turnover ratio, such as changes in payment terms, supplier relationships, or business operations, would provide deeper understanding and help in assessing the company's overall financial health.