Planet Fitness Inc (PLNT)
Days of sales outstanding (DSO)
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 12.02 | 19.04 | 18.44 | 26.80 | 17.52 | 19.43 | 15.72 | 29.71 | 12.78 | 14.15 | 14.12 | 16.06 | 11.48 | 18.75 | 13.27 | 13.09 | 8.95 | 9.51 | 12.92 | 20.05 | |
| DSO | days | 30.36 | 19.17 | 19.80 | 13.62 | 20.83 | 18.79 | 23.22 | 12.28 | 28.55 | 25.79 | 25.84 | 22.73 | 31.79 | 19.46 | 27.51 | 27.89 | 40.78 | 38.37 | 28.25 | 18.20 |
December 31, 2024 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 12.02
= 30.36
Days Sales Outstanding (DSO) is a measure of how long it takes for a company to collect payment after making a sale. A lower DSO indicates that a company is collecting payments more quickly, which is generally seen as a positive indicator of financial health.
Analyzing Planet Fitness Inc's DSO over the past few years shows fluctuations in the collection period. For example, the DSO was consistently low in the range of 18-28 days during the period from March 2020 to September 2021. However, there was a notable increase in DSO to around 40 days by December 2021, which may indicate a delay in collecting payments for sales made during that period.
Subsequently, the DSO improved significantly to around 12-25 days from March 2022 to September 2024, suggesting that the company became more efficient in collecting payments. The decrease in DSO during these periods could be a result of improved invoicing processes, enhanced collection efforts, or changes in customer credit terms.
Overall, the trend in Planet Fitness Inc's DSO indicates variability in the company's collection efficiency. It would be essential for the company to maintain a balance between ensuring timely collections and maintaining good customer relations to support its financial performance.