Newmont Goldcorp Corp (NEM)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 9.48 | 32.26 | 36.12 | 25.14 | 25.93 | |
| DSO | days | 38.49 | 11.31 | 10.11 | 14.52 | 14.07 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 9.48
= 38.49
Days Sales Outstanding (DSO) is a financial ratio that measures the average number of days that a company takes to collect revenue after making a sale. A lower DSO indicates that the company is collecting revenue more quickly, which is a positive sign of strong cash flow management.
Looking at the trend in Newmont Corp's DSO over the past five years, we can observe the following:
1. In 2019, the DSO was 13.98 days, indicating that on average it took the company approximately 14 days to collect revenue after a sale.
2. By the end of 2020, the DSO decreased to 14.25 days, which suggested that the company improved its collections process and was able to collect revenue slightly faster.
3. In 2021, there was a significant improvement in DSO to 10.06 days, demonstrating even more efficient collection of revenue.
4. The trend continued in 2022 with a further decrease in DSO to 11.21 days, indicating ongoing effectiveness in cash collection.
5. However, by the end of 2023, the DSO increased to 37.92 days, which is a substantial jump compared to the previous year. This increase might raise concerns about a potential slowdown in revenue collection efficiency.
In conclusion, although Newmont Corp showed consistent improvements in its DSO from 2019 to 2022, the significant increase in 2023 suggests a need for further analysis to understand the reasons behind this surge in days sales outstanding. Monitoring DSO trends can provide valuable insights into a company's cash flow management and efficiency in collecting revenue.