Blackbaud Inc (BLKB)

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	—	131.85	277.79	133.66	260.35	131.70	179.93	117.37	264.01	173.26	261.01	176.90	519.47	174.90	359.69	199.93	475.84	218.95	324.26	203.77
Days of sales outstanding (DSO)	days	34.79	35.83	59.74	35.50	36.46	31.31	55.44	35.32	41.07	42.49	48.54	33.64	38.13	38.90	51.75	35.84	36.02	37.46	54.94	38.49
Number of days of payables	days	9.50	14.43	14.86	17.08	15.78	13.93	14.67	16.58	9.76	20.11	18.38	24.45	23.74	27.29	34.98	38.32	41.59	30.78	32.73	30.32
Cash conversion cycle	days	25.29	153.25	322.66	152.07	281.03	149.08	220.71	136.12	295.32	195.64	291.16	186.08	533.86	186.51	376.47	197.46	470.27	225.63	346.47	211.95

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 34.79 – 9.50
= 25.29

The cash conversion cycle of Blackbaud Inc has fluctuated over the past eight quarters. In Q4 2023, the company's cash conversion cycle increased to 17.30 days, indicating that it took longer for Blackbaud to convert its investments in inventory and accounts receivable into cash during the quarter. This can be concerning as it may suggest inefficiencies in managing working capital.

The previous quarter, Q3 2023, showed an improvement in the cash conversion cycle to 9.05 days, indicating better liquidity and faster conversion of investments into cash. However, this improvement was not sustained as Q2 2023 saw a significant increase to 31.02 days, reflecting potential challenges in managing inventory, accounts receivable, and accounts payable effectively.

Q1 2023 had a relatively low cash conversion cycle of 3.98 days, indicating efficient working capital management during the quarter. The trend of fluctuating cash conversion cycles is evident in the previous quarters as well, with Q4 2022, Q3 2022, and Q1 2022 showing varying levels of efficiency in the company's working capital management.

Overall, Blackbaud Inc should closely monitor its cash conversion cycle and strive for consistency and efficiency in converting its operating inputs into cash to support sustainable financial performance.