Artivion Inc (AORT)

Cash conversion cycle

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Days of inventory on hand (DOH)	days	85.60	95.54	277.28	312.01	207.82
Days of sales outstanding (DSO)	days	81.73	86.75	70.97	70.27	73.81
Number of days of payables	days	13.91	15.40	37.45	41.11	38.36
Cash conversion cycle	days	153.43	166.89	310.80	341.17	243.28

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 85.60 + 81.73 – 13.91
= 153.43

Based on the data provided, Artivion Inc's cash conversion cycle has shown a fluctuating trend over the past five years. The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash inflows from sales.

In 2019, the company had a relatively efficient cash conversion cycle of 243.28 days, suggesting that it was able to swiftly convert its investments into cash receipts. However, in 2020 and 2021, the cash conversion cycle increased significantly to 341.17 days and 310.80 days respectively, indicating a longer period required to convert investments into cash.

The trend improved slightly in 2022 with a cash conversion cycle of 285.88 days, but it remained elevated compared to the initial period. In the most recent year, the cycle further decreased to 277.20 days, signaling some improvement in managing the cash conversion process.

Overall, the fluctuations in Artivion Inc's cash conversion cycle suggest potential challenges in managing inventory, collecting receivables, and paying suppliers efficiently. The company may need to focus on streamlining its operations, improving inventory turnover, and optimizing its accounts receivable and payable processes to shorten the cash conversion cycle and enhance cash flow management.