AAR Corp (AIR)

The cash conversion cycle (CCC) for AAR Corp over the analyzed period demonstrates notable fluctuations with a general trend of reduction followed by a significant decrease in recent years. Specifically, as of May 31, 2021, the CCC was approximately 162.34 days, indicating the average time it takes for the company to convert its investments in inventory and other resources into cash flows from sales spanned over approximately five months and two weeks.

By May 31, 2022, the CCC decreased slightly to around 153.14 days, reflecting marginal improvements in the company's working capital management or operational efficiencies during that period. The following year, the CCC persisted around a similar level at 153.80 days as of May 31, 2023, implying stability in the company's liquidity cycle.

However, in the subsequent period ending May 31, 2024, the CCC rose again slightly to approximately 160.90 days, which may suggest some operational or market factors affecting the time it takes for cash inflows and outflows to realign.

The most notable change occurs by May 31, 2025, where the CCC sharply declines to approximately 64.99 days. This dramatic reduction signifies a substantial improvement in the company's cash flow efficiency, possibly due to enhanced inventory management, faster receivables collection, or improved payable practices. Such a reduction in the CCC typically indicates a more efficient working capital cycle, allowing the company to convert its investments into cash more rapidly and potentially strengthening liquidity position.

Overall, the data shows that AAR Corp experienced periods of relative stability in its cash conversion cycle, with a significant efficiency improvement observed in the most recent year and reflected in the near-halving of the cycle duration. This trend highlights a possible strategic focus on optimizing operational processes and working capital management to accelerate cash flow realization.

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May 31, 2025