Powell Industries Inc (POWL)
Days of sales outstanding (DSO)
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 9.44 | 6.77 | 10.03 | 12.00 | 14.73 | |
| DSO | days | 38.66 | 53.92 | 36.37 | 30.42 | 24.78 |
September 30, 2024 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 9.44
= 38.66
The days of sales outstanding (DSO) for Powell Industries Inc have varied over the past five years. In the most recent fiscal year ending September 30, 2024, the DSO was 38.66 days, which represents the average number of days it takes for the company to collect payments from its customers. This DSO figure was higher compared to the previous year, indicating that Powell Industries took longer to convert its accounts receivable into cash in 2024.
Looking at the trend over the five-year period, there was an increasing trend in DSO from 24.78 days in 2020 to 38.66 days in 2024. This upward trend suggests a potential deterioration in the efficiency of the company's accounts receivable management. A higher DSO could point to issues with collections, credit policies, or customer payment behavior that may require further investigation.
It is essential for Powell Industries to closely monitor and manage its DSO to ensure timely collection of payments, optimize working capital, and maintain healthy cash flows. Analyzing the reasons behind the fluctuation in DSO and implementing strategies to improve collection processes and tighter credit controls could help enhance the company's overall financial performance and liquidity position in the future.
Peer comparison
Sep 30, 2024