Albany International Corporation (AIN)

Cash conversion cycle

		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	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	65.48	73.95	64.32	66.74	61.82	61.66	63.07	60.39	59.67	60.80	63.28	62.32	61.04	64.80	66.00	62.11	52.91	58.55	58.41	57.80
Days of sales outstanding (DSO)	days	99.89	97.40	88.96	81.95	79.37	80.78	83.99	90.42	87.23	91.14	89.26	89.83	87.77	92.13	82.47	80.19	82.62	83.69	83.47	91.21
Number of days of payables	days	33.64	28.64	27.96	33.09	30.99	30.12	33.23	31.45	34.90	28.00	29.02	29.04	27.17	26.78	28.67	33.41	36.26	33.78	34.68	41.81
Cash conversion cycle	days	131.73	142.70	125.31	115.60	110.20	112.32	113.82	119.36	112.00	123.94	123.51	123.11	121.64	130.16	119.81	108.88	99.27	108.46	107.20	107.20

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 65.48 + 99.89 – 33.64
= 131.73

Albany International Corp.'s cash conversion cycle has varied over the past eight quarters, ranging from 109.78 days to 148.79 days. In the most recent quarter, Q4 2023, the cash conversion cycle was 133.07 days. This indicates that, on average, the company takes approximately 133 days to convert its investments in inventory and accounts receivable into cash received from its customers.

A decreasing trend from Q3 2022 to Q1 2023 is observed, indicating an improvement in efficiency in managing its working capital. However, in the subsequent quarters, the cash conversion cycle increased, reaching its peak at 148.79 days in Q3 2023 before slightly declining to 133.07 days in Q4 2023.

Managers should closely monitor the components of the cash conversion cycle, namely days inventory outstanding, days sales outstanding, and days payables outstanding, to identify areas where improvements can be made to optimize working capital management and enhance cash flow efficiency.