Somnigroup International Inc. (SGI)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 10.80 | 11.65 | 11.75 | 9.58 | 8.35 | |
| DSO | days | 33.81 | 31.34 | 31.05 | 38.09 | 43.72 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 10.80
= 33.81
Analyzing Somnigroup International Inc.'s Days Sales Outstanding (DSO) provides insight into the efficiency of the company's accounts receivable management. The trend in DSO over the past five years indicates a positive development.
As of December 31, 2019, the company had a DSO of 43.72 days, which decreased to 38.09 days in 2020, demonstrating an improvement in collecting receivables more efficiently. Subsequently, by the end of 2021, the DSO decreased further to 31.05 days, indicating the company's ability to convert sales into cash at a faster rate.
The trend continued into 2022 with a slight increase in DSO to 31.34 days, suggesting a stable collection process. By December 31, 2023, the DSO increased slightly to 33.81 days, potentially signaling a need for the company to focus on maintaining the efficiency of its accounts receivable management to prevent any delays in receiving cash from sales.
Overall, the decreasing trend in DSO from 2019 to 2021 reflects the company's effectiveness in managing its accounts receivable and converting sales into cash promptly. However, the slight increase observed in 2022 and 2023 emphasizes the importance of keeping a close eye on receivables management to sustain efficiency and cash flow in the future.
Peer comparison
Dec 31, 2023