The Wendy’s Co (WEN)
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 | 1,246,826 | 1,244,814 | 1,242,103 | 1,234,703 | 1,156,976 | 1,110,810 | 1,059,363 | 1,016,543 | 978,419 | 890,784 | 915,736 | 916,014 | 939,553 | 911,407 | 904,258 | 913,038 | 896,643 | 857,859 | 837,417 | 737,501 |
| Payables | US$ in thousands | 27,370 | 41,693 | 38,640 | 45,338 | 43,996 | 34,667 | 36,156 | 33,152 | 41,163 | 26,506 | 32,430 | 29,325 | 31,063 | 18,014 | 20,597 | 22,537 | 22,701 | 23,793 | 17,315 | 16,356 |
| Payables turnover | 45.55 | 29.86 | 32.15 | 27.23 | 26.30 | 32.04 | 29.30 | 30.66 | 23.77 | 33.61 | 28.24 | 31.24 | 30.25 | 50.59 | 43.90 | 40.51 | 39.50 | 36.06 | 48.36 | 45.09 |
December 31, 2023 calculation
Payables turnover = Cost of revenue (ttm) ÷ Payables
= $1,246,826K ÷ $27,370K
= 45.55
The payables turnover ratio measures how efficiently a company is managing its accounts payable by calculating how many times during a period the company pays off its average accounts payable balance.
Looking at Wendy's Co payables turnover ratio over the past 8 quarters, there has been some fluctuation in the ratio. In Q4 2023, the payables turnover ratio was 29.03, significantly higher than previous quarters, indicating that Wendy's Co is paying off its accounts payable at a faster rate in this period.
The highest payables turnover ratio in the recent quarters was in Q4 2022 at 21.14, followed closely by Q2 2023 at 20.40. These periods suggest that Wendy's Co was managing its accounts payable efficiently, paying off its obligations relatively quickly.
On the other hand, the lowest payables turnover ratio was in Q1 2023 at 17.31, indicating a slower rate of paying off accounts payable during that quarter.
Overall, Wendy's Co's payables turnover ratio has shown some variability over the past 8 quarters, which could imply fluctuations in the company's liquidity management or supplier relationships. It will be essential for the company to monitor this ratio consistently to ensure efficient management of its payables in the future.
Peer comparison
Dec 31, 2023