CSG Systems International Inc (CSGS)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | — | — | — | — | — |
| Receivables turnover | 3.33 | 3.32 | 3.64 | 3.72 | 3.54 |
| Payables turnover | 18.63 | 17.50 | 21.45 | 24.97 | 21.92 |
| Working capital turnover | 3.88 | 4.57 | 19.66 | 3.56 | 3.98 |
Inventory turnover is not provided in the data table, which may suggest that the company does not hold significant inventory or the information is not disclosed.
Receivables turnover, which measures how efficiently the company collects outstanding receivables from its customers, has been relatively stable over the past five years, ranging from 3.32 to 3.72 times per year. This indicates that CSG Systems International Inc. is turning its accounts receivable into cash at a consistent rate.
Payables turnover, which demonstrates how quickly the company pays its suppliers, has shown fluctuations over the years. The ratio increased from 11.84 in 2022 to 13.25 in 2023, which suggests that the company extended its payment period to suppliers slightly.
Working capital turnover, which evaluates how effectively the company utilizes its working capital to generate sales, has seen significant variation, with a remarkable increase from 2019 to 2021 and a subsequent drop in 2022. The ratio decreased further in 2023, indicating a potential slowdown in the company's efficiency in utilizing its working capital to drive revenue.
Overall, CSG Systems International Inc. has been efficiently managing its receivables and payables, but there may be areas for improvement in terms of optimizing working capital turnover to drive revenue growth.
Average number of days
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 109.56 | 109.82 | 100.17 | 98.23 | 103.19 |
| Number of days of payables | days | 19.59 | 20.86 | 17.02 | 14.62 | 16.65 |
Activity ratios provide insights into how effectively a company is managing its assets and liabilities. Let's analyze CSG Systems International Inc.'s activity ratios based on the provided data:
1. Days of Inventory on Hand (DOH): Unfortunately, the data for Days of Inventory on Hand is missing for all years. Without this information, it is challenging to assess how efficiently the company is managing its inventory levels and turning them into sales. A low DOH ratio would indicate that the company is effectively managing its inventory, while a high ratio may suggest inefficiencies in inventory management.
2. Days of Sales Outstanding (DSO): The Days of Sales Outstanding have fluctuated over the years, with the highest value recorded in 2023 at 109.63 days. This ratio indicates the average number of days it takes for the company to collect its accounts receivable. A higher DSO may suggest that the company is struggling to collect payments from customers promptly, leading to potential cash flow issues. CSG Systems International Inc. should aim to reduce its DSO over time to improve its liquidity and cash flow.
3. Number of Days of Payables: The Number of Days of Payables has also shown variability, increasing from 20.33 days in 2020 to 27.54 days in 2023. This ratio represents the average number of days it takes for the company to pay its suppliers. A longer payable period can indicate that the company is effectively managing its cash flow by delaying payments to suppliers. However, excessively long payment periods may strain relationships with suppliers. CSG Systems International Inc. should strike a balance between optimizing cash flow and maintaining positive supplier relationships.
In conclusion, CSG Systems International Inc. should focus on efficiently managing its receivables, payables, and inventory to enhance its overall financial performance and liquidity position. Monitoring and improving these activity ratios can lead to a more streamlined operations and improved cash flow management.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 17.85 | 15.20 | 14.19 | 12.12 | 11.81 |
| Total asset turnover | 0.81 | 0.81 | 0.75 | 0.74 | 0.78 |
CSG Systems International Inc.'s long-term activity ratios exhibit a positive trend over the past five years. The fixed asset turnover ratio has been steadily increasing from 11.81 in 2019 to 17.84 in 2023, indicating that the company is generating more revenue from its fixed assets each year. This suggests improved operational efficiency and asset utilization.
On the other hand, the total asset turnover ratio has remained relatively stable around 0.75 to 0.81 over the same period. While this ratio is lower compared to the fixed asset turnover, it is important to note that CSG Systems International Inc. may have significant non-current assets, such as investments or intangible assets, that contribute to its overall asset base but do not necessarily generate revenue at the same rate as fixed assets.
Overall, the increasing trend in the fixed asset turnover ratio signifies improved efficiency in utilizing fixed assets to generate sales, which bodes well for the company's long-term operational performance and profitability. The stable total asset turnover ratio suggests that CSG Systems International Inc. has maintained a consistent level of revenue generation relative to its total asset base, reflecting a balanced approach to asset management.