World Kinect Corporation (WKC)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 41,141,600 | 46,652,400 | 57,954,100 | 30,548,800 | 19,506,500 |
| Payables | US$ in thousands | 2,726,500 | 3,097,600 | 3,529,500 | 2,399,600 | 1,214,700 |
| Payables turnover | 15.09 | 15.06 | 16.42 | 12.73 | 16.06 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $41,141,600K ÷ $2,726,500K
= 15.09
The payables turnover ratio measures how efficiently a company is managing its accounts payable by calculating how many times during a period it pays off its suppliers. The formula for payables turnover is total purchases divided by average accounts payable.
Based on the data provided for World Kinect Corporation:
- On December 31, 2020, the payables turnover ratio was 16.06 times.
- On December 31, 2021, the payables turnover ratio decreased to 12.73 times.
- On December 31, 2022, the ratio improved to 16.42 times.
- On December 31, 2023, the payables turnover was 15.06 times.
- On December 31, 2024, the ratio remained relatively stable at 15.09 times.
A higher payables turnover ratio generally indicates that the company is managing its payables effectively, paying off its suppliers more frequently. Conversely, a lower ratio may suggest inefficiencies in managing payables or that the company is taking longer to pay its suppliers.
Overall, World Kinect Corporation has shown fluctuations in its payables turnover ratio over the years, with a mix of improvements and declines. Further analysis would be necessary to understand the reasons behind these fluctuations and assess the company's overall efficiency in managing its accounts payable.