Amcor PLC (AMCR)
Cash conversion cycle
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 104.06 | 67.85 | 67.49 | 75.93 | 71.75 |
| Days of sales outstanding (DSO) | days | 83.32 | 49.40 | 46.58 | 48.56 | 52.90 |
| Number of days of payables | days | 104.63 | 86.19 | 82.03 | 95.67 | 92.75 |
| Cash conversion cycle | days | 82.75 | 31.06 | 32.03 | 28.82 | 31.89 |
June 30, 2025 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 104.06 + 83.32 – 104.63
= 82.75
The cash conversion cycle (CCC) of Amcor PLC exhibited fluctuations over the analyzed period from June 30, 2021, to June 30, 2025. As of June 30, 2021, the CCC was approximately 31.89 days, indicating that the company took about a month to convert its investments in inventory and receivables into cash, after accounting for its payables.
In the subsequent year, the CCC decreased slightly to 28.82 days by June 30, 2022, reflecting an improvement in the company's operational efficiency. This reduction suggests that Amcor was able to streamline its processes, possibly by accelerating receivables collection or optimizing inventory turnover, thereby shortening the cycle to generate cash flow.
By June 30, 2023, the CCC increased to approximately 32.03 days, indicating a reversal of the prior trend. The cycle’s elongation could be caused by longer receivables collection periods, increased inventory holding times, or delays in payable settlements. This change, albeit moderate, points to a potential slowdown in cash flow conversion efficiency.
The marginal decline again was observed by June 30, 2024, when the CCC slightly decreased to 31.06 days. This suggests a stabilization of operational and cash flow management, maintaining a cycle close to previous levels.
However, a significant divergence appeared in the year ending June 30, 2025, with the CCC sharply increasing to 82.75 days. This substantial elongation indicates a notable decline in cash conversion efficiency, which could stem from extended receivables periods, increased inventory levels, delays in payables, or a combination thereof. The drastic change from the prior stable range suggests potential changes in working capital management or external factors affecting operational cycles.
Overall, the trend from 2021 to 2024 implies relative stability and operational efficiency, with minor fluctuations. The abrupt increase in 2025 warrants further investigation into potential causes such as strategic shifts, supply chain disruptions, or financial policy changes impacting working capital cycles.
Peer comparison
Jun 30, 2025