Albertsons Companies (ACI)
Cash conversion cycle
| Feb 28, 2025 | Feb 29, 2024 | Feb 28, 2023 | Feb 28, 2022 | Feb 28, 2021 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 31.32 | 30.70 | 31.23 | 32.11 | 31.86 |
| Days of sales outstanding (DSO) | days | 3.79 | 3.34 | 3.23 | 2.85 | 2.89 |
| Number of days of payables | days | 25.70 | 26.18 | 27.25 | 30.22 | 25.83 |
| Cash conversion cycle | days | 9.42 | 7.85 | 7.21 | 4.73 | 8.91 |
February 28, 2025 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 31.32 + 3.79 – 25.70
= 9.42
The cash conversion cycle (CCC) of Albertsons Companies has exhibited notable fluctuations over the analyzed period from February 28, 2021, to February 28, 2025. Specifically, at the end of fiscal year 2021, the CCC was 8.91 days, indicating the average number of days it takes the company to convert its investments in inventory and receivables into cash, offset by its accounts payable period. This figure decreased substantially to 4.73 days by the end of fiscal year 2022, suggesting an improved efficiency in managing inventory, receivables, or payables, leading to a shorter cycle and potentially stronger liquidity positioning during this period.
However, the CCC increased again to 7.21 days by the end of fiscal year 2023, signaling a slight elongation in the duration of working capital conversion. This upward trend continued into the next fiscal year, reaching 7.85 days as of February 29, 2024, and further rising to 9.42 days by February 28, 2025. The gradual elongation of the cash conversion cycle in these successive years may imply increased inventory holding times, delayed receivables collection, or changes in payment terms with suppliers.
Overall, the company's cash conversion cycle has demonstrated a pattern of initial improvement followed by a normalization period, with the latest figure indicating a lengthier cycle relative to the prior years. This trend underscores the importance of monitoring working capital management strategies, as longer cycles can impact liquidity and operational efficiency.
Peer comparison
Feb 28, 2025