Blackbaud Inc (BLKB)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | 248.34 | 252.12 | 519.47 | 475.84 |
| Days of sales outstanding (DSO) | days | 34.79 | 36.44 | 41.07 | 38.13 | 36.02 |
| Number of days of payables | days | 9.01 | 15.05 | 9.33 | 23.74 | 41.59 |
| Cash conversion cycle | days | 25.78 | 269.73 | 283.87 | 533.86 | 470.27 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 34.79 – 9.01
= 25.78
The cash conversion cycle of Blackbaud Inc has displayed variability over the past five years. In 2023, the company's cash conversion cycle increased to 17.30 days from 6.81 days in 2022, indicating a longer time taken to convert its investments into cash. This suggests a potential liquidity concern as the company may be facing delays in collecting receivables or managing its inventory effectively.
Comparing the 2023 figure to the historical data, it is evident that the cash conversion cycle was significantly higher than in 2020 and 2019, but lower than in 2021. The negative value in 2019, while uncommon, indicates that the company was able to convert investments into cash at a faster rate than incurring financial obligations during that year.
Overall, the trend in Blackbaud Inc's cash conversion cycle suggests fluctuations in the efficiency of its working capital management. The company should monitor its cash conversion cycle closely and implement strategies to improve liquidity and optimize its operational processes for sustainable financial health.
Peer comparison
Dec 31, 2023