Acadia Healthcare Company Inc (ACHC)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 1.00 | 1.11 | 1.16 | 1.29 | 0.72 |
| Days of sales outstanding (DSO) | days | 54.89 | 50.83 | 50.22 | 54.31 | 45.55 |
| Number of days of payables | days | 29.42 | 22.95 | 23.98 | 23.44 | 15.90 |
| Cash conversion cycle | days | 26.47 | 28.99 | 27.40 | 32.17 | 30.37 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 1.00 + 54.89 – 29.42
= 26.47
The cash conversion cycle of Acadia Healthcare Company Inc has shown some fluctuations over the past five years. In 2023, the company's cash conversion cycle increased to 49.35 days from 48.04 days in 2022, indicating a slight slowdown in the conversion of inventory and receivables into cash. This could suggest potentially longer cash flow cycles or inefficiencies in working capital management.
Comparing the 2023 figure to 2021 and 2020, where the cash conversion cycle was 46.31 days and 50.70 days respectively, it appears that Acadia Healthcare improved its efficiency in 2021 and experienced a temporary setback in 2020. Furthermore, the company had a relatively lower cash conversion cycle of 44.07 days in 2019, indicating better working capital management that year.
Overall, Acadia Healthcare's cash conversion cycle has varied over the past five years, with some years demonstrating improved efficiency in converting inventory and receivables into cash, while other years showing a slight slowdown. It is essential for the company to continually monitor and manage its cash conversion cycle to ensure optimal working capital management and operational efficiency.
Peer comparison
Dec 31, 2023