Reliance Steel & Aluminum Co (RS)
Payables turnover
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 12,843,000 | 12,989,900 | 13,455,300 | 13,981,500 | 14,301,900 | 14,574,700 | 14,179,500 | 13,245,000 | 11,934,600 | 9,985,900 | 8,611,500 | 7,554,900 | 7,565,900 | 7,789,000 | 8,310,200 | 9,029,400 | 7,148,900 | 7,599,500 | 7,349,800 | 6,858,700 |
| Payables | US$ in thousands | 410,300 | 445,400 | 499,800 | 545,000 | 412,400 | 481,600 | 663,800 | 636,200 | 453,900 | 519,400 | 473,600 | 361,000 | 259,300 | 260,000 | 247,100 | 347,000 | 275,000 | 385,900 | 396,100 | 485,300 |
| Payables turnover | 31.30 | 29.16 | 26.92 | 25.65 | 34.68 | 30.26 | 21.36 | 20.82 | 26.29 | 19.23 | 18.18 | 20.93 | 29.18 | 29.96 | 33.63 | 26.02 | 26.00 | 19.69 | 18.56 | 14.13 |
December 31, 2023 calculation
Payables turnover = Cost of revenue (ttm) ÷ Payables
= $12,843,000K ÷ $410,300K
= 31.30
Reliance Steel & Aluminum Co.'s payables turnover ratio has exhibited fluctuations over the past eight quarters. The payables turnover ratio measures how efficiently a company is managing its payables by examining the number of times the company pays off its average accounts payable balance during a period.
In Q4 2023, the payables turnover ratio was 25.00, indicating that the company paid off its accounts payable 25 times during that quarter. This represents an increase from the previous quarter's ratio of 23.40 in Q3 2023, suggesting that the company improved its efficiency in managing its payables.
Looking at the trend over the past year, the payables turnover ratio has generally been in an upward trajectory since Q2 2022 when it was at 17.57. This indicates that Reliance Steel & Aluminum Co. has been managing its payables more effectively over time.
The increase in the payables turnover ratio suggests that the company is paying off its suppliers more frequently, which could indicate strong liquidity and good relationships with suppliers. However, a very high payables turnover ratio may also indicate potential strain on supplier relationships if the company is paying too quickly.
Overall, Reliance Steel & Aluminum Co.'s increasing payables turnover ratio reflects positively on its operational efficiency and cash flow management in handling its payables.
Peer comparison
Dec 31, 2023