ExlService Holdings Inc (EXLS)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | — | 249.11 | 26.82 | 39.06 | 38.89 |
| Receivables turnover | 5.25 | 5.45 | 5.67 | 4.49 | 3.99 |
| Payables turnover | 275.35 | 156.62 | 171.14 | 121.34 | 138.61 |
| Working capital turnover | 4.58 | 4.22 | 13.42 | 2.45 | 3.15 |
The activity ratios of ExlService Holdings Inc provide insights into the efficiency of the company's operations and management of its working capital.
1. Receivables turnover:
- ExlService Holdings Inc's receivables turnover has been relatively stable over the past five years, ranging from 5.14 to 5.87 times. This indicates that the company is efficient in collecting payments from its customers on an annual basis.
2. Payables turnover:
- The payables turnover for ExlService Holdings Inc has shown a significant increase over the years, reaching 202.35 in 2023. This suggests that the company is taking longer to pay its suppliers, which could either be due to better negotiation terms or potential liquidity management strategies.
3. Working capital turnover:
- The working capital turnover ratio for ExlService Holdings Inc has fluctuated over the years, with a notable increase in 2021 to 13.61 before declining in subsequent years. A high working capital turnover can indicate effective management of working capital to generate revenue, while a lower turnover may signal inefficiencies in capital utilization.
Overall, the activity ratios of ExlService Holdings Inc reflect a mixed performance in terms of operational efficiency and working capital management. The company may benefit from further analysis and strategic initiatives to optimize its activities and enhance overall financial performance.
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 | — | 1.47 | 13.61 | 9.34 | 9.39 |
| Days of sales outstanding (DSO) | days | 69.46 | 67.00 | 64.38 | 81.23 | 91.39 |
| Number of days of payables | days | 1.33 | 2.33 | 2.13 | 3.01 | 2.63 |
Days of inventory on hand (DOH) is not provided in the table, which indicates that the company does not have a specific measure for inventory turnover efficiency. It may be beneficial for ExlService Holdings Inc to calculate and monitor this ratio in the future to assess how quickly the company is converting inventory into sales.
Days of sales outstanding (DSO) has been consistently increasing over the years, indicating that the company is taking longer to collect payments from its customers. This trend suggests a potential issue with the company's accounts receivable management and credit policies, which could affect cash flow and liquidity.
Number of days of payables has decreased over the years, implying that ExlService Holdings Inc is taking fewer days to pay its suppliers. This may indicate improved supplier relationships or negotiating better payment terms. However, excessively extending payables could strain relationships with suppliers in the long run.
Overall, the analysis of ExlService Holdings Inc's activity ratios suggests a need for the company to focus on managing its accounts receivable effectively to maintain healthy cash flow and liquidity. Monitoring inventory turnover efficiency and balancing payment terms with suppliers could also contribute to improved working capital management.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 16.26 | 17.15 | 12.91 | 10.30 | 12.40 |
| Total asset turnover | 1.12 | 1.05 | 0.86 | 0.76 | 0.83 |
ExlService Holdings Inc's long-term activity ratios, specifically fixed asset turnover and total asset turnover, provide insights into the company's efficiency in utilizing its assets to generate revenue over the years.
The fixed asset turnover ratio indicates how effectively the company generates revenue from its fixed assets. ExlService's fixed asset turnover has shown a fluctuating trend over the past five years. The ratio peaked at 17.05 in 2022, indicating that the company generated $17.05 in revenue for every dollar invested in fixed assets, but decreased to 16.25 in 2023. Overall, the declining trend in recent years suggests a decrease in efficiency in utilizing fixed assets to generate revenue.
On the other hand, the total asset turnover ratio reflects the company's ability to generate sales from all its assets. ExlService's total asset turnover ratio has improved from 0.77 in 2020 to 1.13 in 2023. This indicates that the company has been more efficient in generating revenue from its total assets over the years. The increasing trend suggests that ExlService has been able to generate more revenue for each dollar invested in total assets.
In conclusion, while the fixed asset turnover ratio has shown a declining trend, the total asset turnover ratio has been on the rise, indicating that ExlService Holdings Inc has improved its efficiency in utilizing its total assets to generate revenue, despite facing challenges in optimizing its fixed assets for revenue generation.