Linde plc Ordinary Shares (LIN)

Days Sales Outstanding (DSO) is a key financial metric that measures the average number of days a company takes to collect revenue after a sale is made. A lower DSO value indicates that the company is collecting its accounts receivable more quickly, which is generally favorable as it signifies efficient cash flow management.

Analyzing Linde Plc.'s DSO over the past five years, we observe a fluctuating trend. In 2023, the DSO stood at 54.39 days, showing a slight increase from the previous year's 52.34 days. This suggests that the company took slightly longer to collect its accounts receivable in 2023 compared to 2022, which could indicate a potential area for improvement in the collection process.

Comparing the most recent DSO to earlier years, we note that in 2021 and 2020, the DSO was 55.65 days and 59.33 days, respectively. The decreasing trend in these years indicates that Linde Plc. improved its collection efficiency over time. However, it is worth noting that the DSO increased in 2023 compared to 2021 and 2020, signaling a potential reversal in the collection efficiency trend.

Looking further back, in 2019, Linde Plc. had a DSO of 59.44 days, which was similar to the DSO in 2020. The slight decrease in DSO from 2019 to 2020 was a positive sign of improved accounts receivable management during that period.

Overall, while Linde Plc. has shown fluctuations in its DSO over the past five years, a downward trend in DSO is generally considered favorable as it indicates improved efficiency in collecting revenue. However, the slight increase in DSO in 2023 compared to the previous year suggests the company may need to focus on optimizing its accounts receivable collection processes to maintain or further improve its cash flow management.

Peer comparison

Dec 31, 2023