Adtalem Global Education Inc (ATGE)

Cash conversion cycle

		Jun 30, 2024	Mar 31, 2024	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
Days of inventory on hand (DOH)	days	—	—	0.86	0.55	0.38	0.50	0.61	—	—	—	—	—	—	—	—	—	—	—	—	—
Days of sales outstanding (DSO)	days	29.21	33.41	32.62	36.80	25.85	28.57	25.19	28.14	21.50	28.10	30.39	60.97	27.37	30.01	33.76	35.75	30.20	34.11	32.66	41.12
Number of days of payables	days	27.29	24.24	23.70	21.11	22.64	20.31	19.33	16.85	14.91	18.29	19.50	33.33	16.00	13.32	15.45	19.11	18.23	13.56	11.98	16.63
Cash conversion cycle	days	1.92	9.18	9.77	16.24	3.59	8.75	6.46	11.28	6.59	9.80	10.89	27.63	11.36	16.70	18.31	16.64	11.97	20.55	20.68	24.49

June 30, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 29.21 – 27.29
= 1.92

The cash conversion cycle of Adtalem Global Education Inc has fluctuated over the past few quarters. The company's ability to convert its resources into cash has varied significantly in recent periods. Looking at the data provided, we observe that the cash conversion cycle ranged from as low as 1.92 days to as high as 27.63 days over the past few quarters.

A lower cash conversion cycle indicates that the company is able to efficiently convert its investments in inventory and accounts receivable into cash. In contrast, a higher cash conversion cycle suggests a longer period between the company's cash outflows for inventory and receiving cash from customers.

Analyzing the trend, it appears that the company's cash conversion cycle has displayed considerable variability, with peaks and troughs observed in different quarters. This could be due to factors such as changes in sales volumes, inventory management practices, or collection periods for accounts receivable.

Further analysis of the drivers behind these fluctuations in the cash conversion cycle would be necessary to understand the specific reasons for the changes observed. Additionally, monitoring and managing the cash conversion cycle effectively is crucial for the company to optimize its working capital management and ensure efficient use of resources.