Archer-Daniels-Midland Company (ADM)
Cash conversion cycle
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 52.96 | 48.10 | 46.01 | 49.78 | 50.10 | 45.70 | 46.89 | 57.04 | 57.19 | 53.13 | 60.50 | 75.43 | 66.68 | 54.76 | 60.10 | 73.68 | 71.37 | 54.73 | 46.39 | 53.58 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 52.96 | 48.10 | 46.01 | 49.78 | 50.10 | 45.70 | 46.89 | 57.04 | 57.19 | 53.13 | 60.50 | 75.43 | 66.68 | 54.76 | 60.10 | 73.68 | 71.37 | 54.73 | 46.39 | 53.58 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 52.96 + — – —
= 52.96
The cash conversion cycle (CCC) of Archer-Daniels-Midland Company, a measure of how long it takes for the company to convert its investments in inventory and other resources into cash flows from sales, has shown fluctuations over the past few years.
The CCC was around 50-75 days between March 2020 and December 2022, indicating that the company took approximately 50-75 days, on average, to convert its investments in inventory back into cash. This suggests that Archer-Daniels-Midland Company had a moderate level of efficiency in managing its working capital during this period.
From March 2023 onwards, the CCC decreased steadily, reaching a low of around 45 days by September 2023. This reduction implies that the company became more efficient in managing its working capital, possibly by improving inventory turnover or shortening its accounts receivable collection period.
However, the CCC slightly increased from December 2023 to June 2024, but still remained below 50 days, indicating that Archer-Daniels-Midland Company maintained a relatively efficient cash conversion cycle during this period.
Overall, the trend of decreasing CCC from March 2023 to September 2023 followed by a slight increase by the end of 2024 suggests that Archer-Daniels-Midland Company made improvements in its working capital management, although there may have been some challenges towards the latter part of the period.
Peer comparison
Dec 31, 2024