Louisiana-Pacific Corporation (LPX)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 16.65 | 30.35 | 23.17 | 13.04 | 14.09 | |
| DSO | days | 21.92 | 12.03 | 15.76 | 27.99 | 25.91 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 16.65
= 21.92
Louisiana-Pacific Corp.'s Days of Sales Outstanding (DSO) has shown fluctuations over the past five years. In 2023, the DSO stands at 21.92 days, showing an increase from the previous year's 12.03 days. This indicates that, on average, it takes Louisiana-Pacific Corp. approximately 21.92 days to collect its accounts receivable.
The significant increase in DSO from 2022 to 2023 may suggest a potential issue with the company's accounts receivable management or the efficiency of its collection process. Comparing to 2021, the DSO is also higher, indicating that the company took longer to collect payments from customers in 2023. However, the DSO in 2023 is lower than in 2019 and 2020, which could be a positive sign of improved collection efficiency compared to those years.
It is essential for Louisiana-Pacific Corp. to monitor its DSO closely, as a higher DSO can tie up working capital and may indicate difficulties in collecting accounts receivable promptly. Management should assess the reasons behind the increase in DSO and take appropriate actions to improve collection processes and maintain healthy liquidity levels.
Peer comparison
Dec 31, 2023