Valaris Ltd (VAL)
Number of days of payables
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Payables turnover | 4.36 | 1.42 | 26.00 | 7.28 | 4.28 | |
| Number of days of payables | days | 83.78 | 256.50 | 14.04 | 50.12 | 85.27 |
December 31, 2023 calculation
Number of days of payables = 365 ÷ Payables turnover
= 365 ÷ 4.36
= 83.78
The number of days of payables for Valaris Ltd has shown an increasing trend over the past three years. As of December 31, 2023, the number of days of payables stood at 94.61 days, significantly higher than the figures recorded in the previous two years, which were 67.69 days as of December 31, 2022, and 76.85 days as of December 31, 2021.
This increase in the number of days of payables indicates that Valaris Ltd is taking longer to pay its suppliers or vendors for goods or services received. A higher number of days of payables may be reflective of a deliberate strategy to manage working capital more effectively, potentially by extending payment terms to preserve cash flow.
However, it is essential for Valaris Ltd to carefully balance the extension of payables with maintaining strong relationships with suppliers to avoid any adverse impacts on the quality of goods or services received or potential strains on supplier relationships. Regular monitoring and review of the payables cycle will be crucial to ensure it remains in line with the company's overall financial objectives.
Peer comparison
Dec 31, 2023