Norwegian Cruise Line Holdings Ltd (NCLH)

Days of inventory on hand (DOH)

		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
Inventory turnover		48.33	45.51	47.74	47.94	43.00	37.01	31.16	27.64	28.50	27.37	29.43	32.51	65.73	78.34	90.12	96.56	67.15	66.71	68.00	67.14
DOH	days	7.55	8.02	7.65	7.61	8.49	9.86	11.71	13.21	12.81	13.33	12.40	11.23	5.55	4.66	4.05	3.78	5.44	5.47	5.37	5.44

December 31, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 48.33
= 7.55

The days of inventory on hand (DOH) for Norwegian Cruise Line Holdings Ltd have shown a decreasing trend over the past eight quarters. In Q1 2022, the company had the highest inventory turnover, with 89.91 days of inventory on hand, indicating that it took nearly three months to sell its current inventory. Since then, the DOH has steadily decreased to 34.35 days in Q4 2023, which implies that the company is now able to sell its inventory in just over a month.

This trend suggests that Norwegian Cruise Line Holdings Ltd has been managing its inventory more efficiently, reducing the time its products sit unsold. A lower DOH can free up working capital, improve cash flow, and reduce the risk of inventory obsolescence. However, it's essential for the company to strike a balance between carrying enough inventory to meet customer demand and ensuring inventory turnover remains optimal to avoid stockouts or excess inventory costs. Overall, the decreasing trend in DOH reflects positive inventory management practices within the company.