JM Smucker Company (SJM)
Payables turnover
| Apr 30, 2024 | Apr 30, 2023 | Apr 30, 2022 | Apr 30, 2021 | Apr 30, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 6,837,400 | 7,403,000 | 7,057,300 | 6,690,900 | 6,589,400 |
| Payables | US$ in thousands | 1,336,200 | 1,392,600 | 1,193,300 | 1,034,100 | 782,000 |
| Payables turnover | 5.12 | 5.32 | 5.91 | 6.47 | 8.43 |
April 30, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $6,837,400K ÷ $1,336,200K
= 5.12
JM Smucker Company's payables turnover has been declining over the past five years, from 8.43 in 2020 to 5.12 in 2024, indicating a gradual decrease in the company's ability to efficiently manage its accounts payable. This suggests that the company is taking longer to pay off its suppliers relative to its cost of goods sold.
A lower payables turnover ratio may indicate a longer payment period, which could potentially strain the company's relationships with its suppliers if not managed effectively. It could also suggest potential liquidity issues or inefficiencies in the company's working capital management.
However, it is important to consider industry norms and comparative analysis with competitors to fully understand the implications of JM Smucker Company's payables turnover ratio. Additionally, further analysis of the company's financial statements and operating performance would provide a more comprehensive view of its financial health and efficiency in managing its payables.