Amphastar P (AMPH)

Cash conversion cycle

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Days of inventory on hand (DOH)	days	156.70	131.72	151.16	142.31	171.15
Days of sales outstanding (DSO)	days	67.96	65.11	64.96	65.70	68.86
Number of days of payables	days	31.10	31.66	29.92	34.06	43.05
Cash conversion cycle	days	193.56	165.16	186.20	173.95	196.96

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 156.70 + 67.96 – 31.10
= 193.56

The cash conversion cycle of Amphastar P has shown some fluctuations over the past five years. In December 2020, the cycle was at 196.96 days, indicating that it took the company nearly 197 days to convert its invested resources into cash. By the end of 2021, the cycle decreased to 173.95 days, showing an improvement in the company's ability to manage its working capital efficiently.

However, by the end of 2022, the cash conversion cycle increased to 186.20 days, indicating a potential delay in the company's cash conversion process. In contrast, by the end of 2023, the cycle improved significantly to 165.16 days, suggesting a more efficient cash management strategy.

Nonetheless, in December 2024, the cash conversion cycle increased again to 193.56 days, showing a reversal in the positive trend observed the previous year. Overall, the fluctuations in the cash conversion cycle indicate varying efficiency levels in managing the company's cash flow and working capital over the years.