Inter Parfums Inc (IPAR)

Days of sales outstanding (DSO)

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Receivables turnover 5.16 5.17 4.80 5.18 4.19
DSO days 70.71 70.62 76.09 70.47 87.14

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 5.16
= 70.71

Interpreting the Days Sales Outstanding (DSO) metric of Inter Parfums Inc reveals important insights into the company's credit management and efficiency in collecting payments from customers.

Between December 31, 2020, and December 31, 2024, we observe a decline in DSO from 87.14 days to 70.71 days. This trend suggests that Inter Parfums Inc has been successful in reducing the average number of days it takes to collect accounts receivable, indicating improved efficiency in converting credit sales into cash.

A lower DSO signifies that the company is able to collect payments from customers more promptly, which can help in improving cash flow and liquidity. It also reflects effective credit policies and strong customer relationships that lead to timely payments.

Overall, based on the declining DSO trend, it can be inferred that Inter Parfums Inc has been effective in managing its accounts receivable and enhancing its financial performance by optimizing the collection of sales revenues.