Blackline Inc (BL)

Cash conversion cycle

		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
Days of inventory on hand (DOH)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	0.14	—	—	—	—	—	—
Days of sales outstanding (DSO)	days	107.32	83.86	85.91	82.10	106.45	80.37	96.93	103.63	122.85	108.87	107.35	97.67	121.75	105.37	117.12	111.30	132.37	111.62	114.53	113.75
Number of days of payables	days	6.22	4.48	7.35	4.33	14.52	4.14	11.91	13.99	6.81	2.10	3.80	3.48	3.48	2.43	7.32	13.91	9.51	2.16	4.20	6.11
Cash conversion cycle	days	101.10	79.39	78.57	77.77	91.92	76.23	85.02	89.64	116.04	106.77	103.54	94.19	118.28	103.08	109.80	97.39	122.86	109.46	110.33	107.64

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 107.32 – 6.22
= 101.10

The cash conversion cycle of Blackline Inc has fluctuated over the past 20 quarters. It shows the average time taken by the company to convert its investments in inventory and other resources into cash receipts from customers. A lower cash conversion cycle indicates that the company is efficiently managing its working capital and generating cash flows.

From the data provided, we can see that the cash conversion cycle has varied between a low of 76.23 days in the third quarter of 2022 and a high of 122.86 days in the fourth quarter of 2019. Generally, a decreasing trend in the cash conversion cycle is positive, as it implies that the company is improving its efficiency in managing inventory, collecting receivables, and paying suppliers.

However, the cash conversion cycle has shown some volatility, with fluctuations observed across different quarters. This fluctuation could be due to various factors such as changes in sales patterns, inventory management practices, payment terms with suppliers, and collection efficiency from customers.

Overall, Blackline Inc should aim to consistently monitor and improve its cash conversion cycle to optimize its working capital management and enhance its overall financial performance.