Hexcel Corporation (HXL)

Days of sales outstanding (DSO)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Receivables turnover		8.98	7.49	6.92	8.02	11.65
DSO	days	40.66	48.73	52.73	45.48	31.34

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 8.98
= 40.66

Hexcel Corporation's Days Sales Outstanding (DSO) is a measure of how long it takes the company to collect its accounts receivable from customers. From 2020 to 2024, the trend in DSO has been increasing, indicating a potential deterioration in the company's ability to collect its receivables in a timely manner.

In 2020, the DSO stood at 31.34 days, increased to 45.48 days by the end of 2021, and further rose to 52.73 days by the end of 2022. This jump in DSO suggests that Hexcel Corporation may be experiencing difficulties in collecting payments from its customers, which could have implications for its cash flow management.

By the end of 2023, the DSO decreased slightly to 48.73 days, indicating a possible improvement in the company's credit and collection processes. However, it is important to note that the DSO is still higher than the initial value in 2020.

In the most recent year, 2024, the DSO decreased further to 40.66 days, showing a positive trend compared to the previous year. This improvement suggests that Hexcel Corporation may be implementing strategies to enhance its accounts receivable management and accelerate the collection of outstanding payments from customers.

Overall, while there have been fluctuations in Hexcel Corporation's DSO over the years, it is crucial for the company to focus on optimizing its collection processes to ensure efficient cash flow management and maintain healthy liquidity levels.