World Kinect Corporation (WKC)
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 | 17.33 | 17.76 | 17.81 | 17.24 | 17.67 | 17.10 | 21.43 | 19.73 | 17.92 | 17.37 | 12.09 | 10.76 | 13.30 | 12.84 | 12.11 | 10.96 | 16.44 | 20.11 | 21.09 | 18.21 | |
| DSO | days | 21.06 | 20.55 | 20.49 | 21.17 | 20.66 | 21.35 | 17.03 | 18.50 | 20.36 | 21.02 | 30.20 | 33.93 | 27.43 | 28.43 | 30.13 | 33.29 | 22.20 | 18.15 | 17.31 | 20.04 |
December 31, 2024 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 17.33
= 21.06
Days Sales Outstanding (DSO) is a key financial ratio that indicates the average number of days it takes for a company to collect revenue after making a sale. For World Kinect Corporation, the DSO trend over the past few years shows some fluctuations but generally appears to be within a manageable range.
From March 31, 2020, to December 31, 2020, the DSO increased from 20.04 days to 22.20 days, indicating a slight delay in collecting sales. However, the DSO decreased in the following periods up to June 30, 2021, suggesting an improvement in the company's collection efficiency.
There was a significant increase in DSO on March 31, 2021, to 33.29 days, which could be a cause for concern as it indicates a potential delay in collecting revenue. However, the company seems to have made efforts to reduce DSO in the subsequent periods, with DSO ranging between 17 to 30 days from June 30, 2021, to June 30, 2022.
The DSO continued to fluctuate around the 20-day mark from September 30, 2022, to December 31, 2024, with slight variations in collection efficiency. Overall, a lower DSO implies faster collection of sales, which is generally favorable for the company's cash flow and liquidity.
In conclusion, while World Kinect Corporation has experienced some fluctuations in its DSO over the years, maintaining DSO at manageable levels is crucial for efficient working capital management and ensuring timely cash flow from sales. Monitoring and potentially improving DSO could help enhance the company's financial performance in the long run.