Patterson-UTI Energy Inc (PTEN)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 315,899 | 119,958 | 145,360 | 533,663 | 184,195 |
| Payables | US$ in thousands | 534,420 | 237,056 | 190,219 | 91,023 | 170,475 |
| Payables turnover | 0.59 | 0.51 | 0.76 | 5.86 | 1.08 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $315,899K ÷ $534,420K
= 0.59
Patterson-UTI Energy Inc's payables turnover has shown fluctuating trends over the past five years. The payables turnover ratio measures how efficiently a company is managing its payables by calculating the number of times a company pays off its average accounts payable balance during a certain period.
In 2023, the payables turnover ratio decreased to 5.18 from 7.56 in 2022, indicating a decrease in the efficiency of managing payables. This could imply that the company took longer to pay its suppliers in 2023 compared to the previous year.
Comparing 2023 to 2021, the payables turnover ratio also declined from 5.46 to 5.18, suggesting a further slowdown in the management of payables. However, the ratio remains higher than in 2020 (8.36) and 2019 (9.94), indicating that in those years, the company was able to pay off its accounts payable more times within the year.
Overall, the decreasing trend in the payables turnover ratio from 2022 to 2023 may raise concerns about the company's liquidity position and its ability to effectively manage its payables. It is essential for Patterson-UTI Energy Inc to closely monitor its payables turnover ratio and improve efficiency in managing its accounts payable to maintain healthy working capital levels.
Peer comparison
Dec 31, 2023