Balchem Corporation (BCPC)
Days of sales outstanding (DSO)
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 7.36 | 7.18 | 7.52 | 7.20 | 7.16 | 6.55 | 6.33 | 6.15 | 6.81 | 6.92 | 6.54 | 6.69 | 7.16 | 6.98 | 6.93 | 6.24 | 6.89 | 6.82 | 6.27 | 6.40 | |
| DSO | days | 49.57 | 50.84 | 48.55 | 50.69 | 50.96 | 55.69 | 57.70 | 59.36 | 53.63 | 52.71 | 55.83 | 54.53 | 50.95 | 52.26 | 52.67 | 58.45 | 52.99 | 53.55 | 58.20 | 57.00 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 7.36
= 49.57
Days Sales Outstanding (DSO) is a key financial metric that indicates how long it takes for a company to collect revenue after a sale is made. A lower DSO value is generally favorable as it suggests efficient collection of accounts receivable, while a higher DSO value may indicate potential cash flow issues or difficulties with customers' payment timelines.
Analyzing Balchem Corp.'s DSO over the past quarters, we observe a fluctuating trend. In Q4 2023, the DSO decreased to 49.57 days from 50.84 days in Q3 2023, indicating an improvement in the company's accounts receivable collection efficiency. This is a positive sign as it suggests that Balchem Corp. is collecting revenue more quickly, potentially improving its cash flow position.
Comparing the current DSO with the previous year's quarters, we notice that Balchem Corp. has made progress in reducing its DSO from Q4 2022 to Q4 2023. This could be attributed to better credit management practices, improved collection processes, or more favorable payment terms negotiated with customers.
However, it is worth noting that the DSO values for Balchem Corp. in general have been relatively high, indicating that there may still be room for further improvement in optimizing its accounts receivable management. The company should continue to monitor its DSO closely and strive towards maintaining a balance between timely collections and maintaining good customer relationships.
Overall, the recent decrease in DSO for Balchem Corp. is a positive development, signaling improved efficiency in collecting revenue. Continued focus on managing accounts receivable effectively will be crucial for the company's financial health and liquidity position in the long term.
Peer comparison
Dec 31, 2023