Simpson Manufacturing Company Inc (SSD)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 1,728,730 | 1,665,630 | 1,590,040 | 1,153,090 | 972,071 |
| Payables | US$ in thousands | 100,972 | 107,524 | 97,841 | 57,215 | 48,271 |
| Payables turnover | 17.12 | 15.49 | 16.25 | 20.15 | 20.14 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $1,728,730K ÷ $100,972K
= 17.12
The payables turnover ratio measures how efficiently Simpson Manufacturing Company Inc is managing its accounts payable. Over the period from December 31, 2020, to December 31, 2024, the payables turnover has shown relatively consistent performance, with a slight decrease from 20.14 in 2020 to 15.49 in 2023, before slightly rebounding to 17.12 in 2024.
A higher payables turnover ratio indicates that the company is paying its suppliers more quickly, which can be seen as a positive sign of effective cash management. However, a very high ratio may also suggest that the company is not taking full advantage of supplier credit terms.
The fluctuations in the payables turnover ratio for Simpson Manufacturing Company Inc over the years may be due to changes in the company's payment practices, negotiation terms with suppliers, or changes in business operations. It is important for the company to strike a balance between managing payables efficiently while also maintaining good relationships with suppliers. Further analysis and comparison with industry benchmarks may provide additional insights into the company's performance in this area.
Peer comparison
Dec 31, 2024