Hexcel Corporation (HXL)

Days of sales outstanding (DSO)

		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
Receivables turnover		7.49	7.29	6.49	6.06	6.92	7.26	6.15	6.45	8.02	6.97	7.02	7.55	11.72	11.60	10.56	8.44	10.20	8.02	7.30	6.87
DSO	days	48.73	50.10	56.26	60.21	52.73	50.25	59.32	56.60	45.48	52.36	52.01	48.35	31.14	31.47	34.57	43.23	35.80	45.50	50.03	53.14

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 7.49
= 48.73

To analyze Hexcel Corp.'s Days of Sales Outstanding (DSO) over the past eight quarters, it is evident that there has been some fluctuation in the company's collection efficiency. DSO represents the average number of days it takes for a company to collect revenue after making a sale. A lower DSO indicates quicker collection of accounts receivable, which is favorable for cash flow management.

In Q1 2022, Hexcel Corp. had a DSO of 55.10 days, which decreased to 51.52 days in Q4 2022, signaling an improvement in collection efficiency. However, the trend reversed in Q1 2023, with DSO increasing to 58.87 days, indicating a potential delay in collecting revenue.

In subsequent quarters of 2023, there was a slight improvement in DSO, with values of 55.05 days, 49.08 days, and 47.88 days for Q2, Q3, and Q4, respectively. This trend suggests that the company may have implemented better credit policies or enhanced its collection processes to expedite cash inflows.

Overall, it is essential for Hexcel Corp. to monitor and manage its DSO effectively to ensure timely collection of accounts receivable and maintain a healthy cash flow position. Continued focus on improving collection efficiency can contribute to better liquidity and financial stability for the company.