Digi International Inc (DGII)

Receivables turnover

		Sep 30, 2024	Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020
Revenue	US$ in thousands	424,046	444,849	388,225	308,632	279,271
Receivables	US$ in thousands	69,640	55,997	50,450	43,738	59,227
Receivables turnover		6.09	7.94	7.70	7.06	4.72

September 30, 2024 calculation

Receivables turnover = Revenue ÷ Receivables
= $424,046K ÷ $69,640K
= 6.09

Digi International Inc's receivables turnover ratio has shown a fluctuating trend over the last five years. The ratio was 6.09 in 2024, a decrease from the previous year's 7.94. This indicates that the company collected its accounts receivable approximately 6.09 times during the fiscal year, implying a longer collection period compared to the previous year. However, it is important to note that receivables turnover above 1 indicates that the company is collecting its accounts receivable well.

Looking further back, the receivables turnover ratio was relatively stable between 2021 and 2023, ranging from 7.06 to 7.94, suggesting consistent efficiency in collecting receivables during this period. The significant improvement from 4.72 in 2020 to above 7 in subsequent years indicates a positive trend in managing receivables and cash flow.

In conclusion, while the recent decrease in the receivables turnover ratio may be a point of concern, the overall performance in collecting accounts receivable has been relatively strong over the past five years. Further analysis of the company's receivables management practices and comparison with industry benchmarks could provide more insights into its efficiency in this area.