Aramark Holdings (ARMK)

Days of sales outstanding (DSO)

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Receivables turnover		9.77	7.42	6.76	8.69	8.87
DSO	days	37.35	49.18	54.00	42.00	41.15

September 30, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 9.77
= 37.35

Based on the data provided, Aramark Holdings has shown a generally declining trend in its days of sales outstanding (DSO) over the past five years. The DSO represents the average number of days it takes for the company to collect revenue from its sales.

In 2023, the DSO stands at 37.35 days, showing a significant improvement from 49.18 days in 2022. This indicates that Aramark has become more efficient in collecting its accounts receivable, which may suggest better management of credit policies or stronger customer relationships.

Compared to the DSO of 54.00 days in 2021, and 42.00 days in 2020, the current DSO of 37.35 days reflects a positive trend in the company's collection process. Additionally, when comparing to the DSO of 41.15 days in 2019, the current DSO also shows a more favorable position.

The declining trend in DSO over the years indicates that Aramark Holdings has been successful in managing its accounts receivable effectively, which can lead to improved cash flow and liquidity. It suggests that the company is efficiently converting its sales into cash, which is a positive sign for its financial health and operational efficiency.