Adient PLC (ADNT)

Cash conversion cycle

		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	Dec 31, 2019
Days of inventory on hand (DOH)	days	20.11	20.32	20.38	21.25	21.37	22.46	24.29	26.33	26.13	27.43	29.23	27.17	27.71	23.03	22.69	21.79	20.70	21.63	19.29	18.27
Days of sales outstanding (DSO)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Number of days of payables	days	67.69	64.55	64.72	61.79	64.20	67.77	70.76	65.61	67.93	67.96	72.29	65.88	60.48	56.73	71.38	68.27	65.85	43.01	54.84	59.44
Cash conversion cycle	days	-47.59	-44.23	-44.34	-40.54	-42.82	-45.31	-46.47	-39.28	-41.81	-40.53	-43.06	-38.71	-32.77	-33.70	-48.69	-46.48	-45.15	-21.37	-35.55	-41.16

September 30, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 20.11 + — – 67.69
= -47.59

The cash conversion cycle of Adient PLC has exhibited some fluctuations over the past several quarters. The company's cash conversion cycle, which is a measure of how long it takes for a company to convert its investments in inventory and other resources into cash flows from sales, has generally been negative, indicating that Adient has been able to efficiently manage its working capital.

In the most recent quarter, the cash conversion cycle was -47.59 days, which was lower compared to the previous quarter's -44.23 days. This indicates that Adient was able to convert its investments in inventory and receivables into cash at a slightly faster rate in the most recent period.

Looking at the trend over the past few quarters, the cash conversion cycle has generally been below zero, with some variability. The company was able to effectively manage its working capital in recent quarters, as evidenced by the negative cash conversion cycle figures.

Overall, the negative cash conversion cycle suggests that Adient has been able to efficiently manage its cash flow from operations, inventory, and accounts receivable. It indicates that the company has been able to quickly convert its investments into cash, which may reflect strong liquidity and working capital management. However, it is essential to continue monitoring this metric to ensure that the company maintains its efficiency in managing its working capital.