LCI Industries (LCII)

Days of sales outstanding (DSO)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Receivables turnover		17.63	24.30	13.99	10.41	11.86
DSO	days	20.71	15.02	26.10	35.07	30.78

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 17.63
= 20.71

The Days Sales Outstanding (DSO) ratio for LCI Industries has fluctuated over the past five years. In 2023, the DSO decreased to 20.71 days from 15.02 days in 2022, indicating that the company is collecting its accounts receivable at a slower pace compared to the previous year. However, it is still performing better than in 2021 when the DSO was 26.10 days, suggesting improved efficiency in collecting sales revenue from customers.

Compared to 2020 and 2019 when the DSO was 35.07 days and 30.78 days, respectively, the current DSO ratio reflects a more favorable trend in managing accounts receivable. It indicates that LCI Industries has been able to accelerate its collection efforts, which may be attributed to tighter credit policies, enhanced collection processes, or improved customer payment behaviors.

Overall, while the company's DSO ratio has shown some variability in recent years, the recent decrease in DSO in 2023 compared to the prior year is a positive sign of more efficient accounts receivable management. However, further monitoring and analysis of collection processes may be necessary to ensure timely cash flow generation.