Treehouse Foods Inc (THS)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,855,500 | 2,774,700 | 2,479,200 | 2,449,600 | 3,492,100 |
| Payables | US$ in thousands | 534,900 | 618,700 | 625,900 | 627,700 | 508,400 |
| Payables turnover | 5.34 | 4.48 | 3.96 | 3.90 | 6.87 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $2,855,500K ÷ $534,900K
= 5.34
The payables turnover ratio measures how many times a company pays off its accounts payable during a specific period. For Treehouse Foods Inc, the payables turnover ratio has fluctuated over the past five years, indicating the efficiency of the company's payables management.
In 2023, the payables turnover ratio was 5.34, which means the company paid off its accounts payable approximately 5.34 times during the year. This was an improvement from the previous year, where the ratio was 4.75. The increase in the payables turnover ratio from 2022 to 2023 suggests that Treehouse Foods Inc managed its accounts payable more effectively in 2023.
Comparing the payables turnover ratio to previous years, we observe fluctuations in the company's payment efficiency. In 2021, the ratio was 4.62, slightly lower than in 2020 (5.65) and significantly lower than in 2019 (6.87). These fluctuations indicate changes in the company's payment practices and relationships with suppliers.
Overall, Treehouse Foods Inc's payables turnover has shown variability over the past five years, reflecting the company's ability to manage its accounts payable efficiently. The upward trend in 2023 compared to 2022 suggests improvements in payables management, which can be a positive sign for the company's liquidity and relationships with suppliers.
Peer comparison
Dec 31, 2023