Lear Corporation (LEA)

Receivables turnover

		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
Revenue (ttm)	US$ in thousands	46,841,200	44,599,700	44,046,700	43,128,300	42,449,200	40,184,400	39,218,700	38,963,900	39,129,000	19,603,000	20,263,000	17,919,300	17,024,400	16,598,800	16,494,400	19,023,900	19,727,600	19,852,400	19,920,300	20,507,400
Receivables	US$ in thousands	3,681,200	4,041,200	4,259,700	—	3,451,900	—	—	—	3,041,500	—	—	—	—	—	—	—	—	—	—	—
Receivables turnover		12.72	11.04	10.34	—	12.30	—	—	—	12.87	—	—	—	—	—	—	—	—	—	—	—

December 31, 2023 calculation

Receivables turnover = Revenue (ttm) ÷ Receivables
= $46,841,200K ÷ $3,681,200K
= 12.72

The receivables turnover ratio for Lear Corp. has been relatively stable over the past eight quarters, ranging from 5.20 to 6.37. The formula for the receivables turnover ratio is net credit sales divided by average accounts receivable for the period. A higher receivables turnover ratio indicates that the company is collecting its accounts receivable more quickly.

During Q4 2023, Lear Corp. had a receivables turnover ratio of 6.37, which implies that the company collected its accounts receivable approximately 6.37 times over the quarter. This represents an improvement from the previous quarter's ratio of 5.69.

Comparing the Q4 2023 ratio to the ratios from the same quarter in the previous years, Lear Corp. achieved a slightly higher receivables turnover compared to Q4 2022 (6.05). This suggests that the company has been more efficient in collecting its accounts receivable in the most recent quarter.

Consistently high receivables turnover ratios indicate that Lear Corp. has an effective credit and collection policy in place, resulting in quicker cash inflows from its customers. However, it is essential to analyze this ratio in conjunction with other financial metrics to gain a comprehensive understanding of the company's overall financial performance and liquidity management.