Zurn Elkay Water Solutions Corporation (ZWS)

Days of sales outstanding (DSO)

Dec 31, 2024 Sep 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 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019
Receivables turnover 6.90 6.26 6.65 6.74 6.32 6.17 6.05 5.39 3.88 6.11 7.79 10.35 6.15 5.92 6.50 6.83 7.39 6.18 7.08 6.92
DSO days 52.88 58.26 54.89 54.18 57.79 59.12 60.38 67.76 93.96 59.74 46.84 35.25 59.37 61.66 56.19 53.40 49.38 59.07 51.55 52.77

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.90
= 52.88

The Days Sales Outstanding (DSO) is a measure that indicates the average number of days it takes for a company to collect revenue or cash from its credit sales. Analyzing the DSO trend of Zurn Elkay Water Solutions Corporation based on the provided data reveals fluctuations over the years.

1. From September 30, 2019, to December 31, 2019, the DSO decreased slightly from 52.77 days to 51.55 days, indicating an improvement in the company's ability to collect receivables.

2. The DSO increased significantly to 59.07 days by March 31, 2020, but then decreased to 49.38 days by June 30, 2020, showing some volatility in collection efficiency.

3. Subsequently, there were fluctuations in DSO over the following quarters, with values ranging from 53.40 days to 61.66 days up to June 30, 2021, suggesting potential challenges in managing accounts receivable.

4. A notable decrease in DSO to 35.25 days by December 31, 2021, may indicate an improvement in the company's credit and collection policies or efficiency in collecting outstanding payments.

5. However, the DSO increased again to 93.96 days by September 30, 2022, which is a concerning sign as it suggests delays in collecting payments from customers.

6. The DSO trend then showed some improvement, stabilizing around 54-60 days from March 31, 2023, to September 30, 2024, indicating the company's efforts to enhance its accounts receivable management.

Overall, the analysis of Zurn Elkay Water Solutions Corporation's DSO reflects fluctuations in the efficiency of the company's receivables management over the years, with periods of improvement and challenges in collecting payments from customers. Monitoring and managing DSO effectively are crucial for maintaining healthy cash flow and financial stability.