Acuity Brands Inc (AYI)
Cash conversion cycle
| Aug 31, 2024 | Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 42.42 | 37.98 | 50.09 | 73.28 | 60.73 |
| Days of sales outstanding (DSO) | days | 53.57 | 51.80 | 61.05 | 60.30 | 54.90 |
| Number of days of payables | days | 38.56 | 29.44 | 41.03 | 71.95 | 61.94 |
| Cash conversion cycle | days | 57.44 | 60.33 | 70.11 | 61.63 | 53.68 |
August 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 42.42 + 53.57 – 38.56
= 57.44
The cash conversion cycle of Acuity Brands Inc has shown some fluctuations over the past five years. In the most recent fiscal year ended August 31, 2024, the company's cash conversion cycle was 57.44 days, indicating that it took an average of 57.44 days for the company to convert its resources into cash. This represents an improvement compared to the previous year's figure of 60.33 days.
Looking further back, the cash conversion cycle was at its highest in August 31, 2022, at 70.11 days. This suggests that the company took longer to convert its investments in inventory and accounts receivable into cash in that particular year. However, the trend seems to have reversed in the following years.
In general, a shorter cash conversion cycle implies that the company is more efficient in managing its working capital and converting its assets into cash. It is important to monitor the cash conversion cycle as it can indicate the company's effectiveness in managing its operations and cash flow. Acuity Brands Inc should continue to focus on optimizing its cash conversion cycle to improve its overall financial performance.
Peer comparison
Aug 31, 2024