World Kinect Corporation (WKC)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 17.67 | 17.92 | 13.30 | 16.44 | 12.73 | |
| DSO | days | 20.66 | 20.36 | 27.43 | 22.20 | 28.67 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 17.67
= 20.66
World Kinect Corp's Days Sales Outstanding (DSO) measures the average number of days it takes the company to collect revenue from its credit sales. A lower DSO indicates quicker collections, which may be favorable for the company's cash flow and liquidity.
From 2019 to 2023, World Kinect Corp has shown improvement in its DSO, decreasing from 28.67 days in 2019 to 20.93 days in 2023. This downward trend suggests that the company has been efficient in collecting payments from its customers, potentially indicating strong credit management practices or improved customer relationships.
The lower DSO in 2023 compared to previous years could signify that World Kinect Corp has become more effective in managing its accounts receivable, leading to faster cash inflows and potentially reducing the risk of bad debts. However, it is essential for the company to monitor its DSO regularly to ensure that the improvement is sustainable and not simply a temporary fluctuation due to external factors.