Baxter International Inc (BAX)

Cash conversion cycle

		Dec 31, 2024	Sep 30, 2024	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
Days of inventory on hand (DOH)	days	92.37	88.19	113.15	110.79	104.10	105.78	106.14	110.42	102.11	103.87	112.17	112.91	116.60	97.75	101.40	101.57	98.69	106.13	104.07	92.53
Days of sales outstanding (DSO)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Number of days of payables	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Cash conversion cycle	days	92.37	88.19	113.15	110.79	104.10	105.78	106.14	110.42	102.11	103.87	112.17	112.91	116.60	97.75	101.40	101.57	98.69	106.13	104.07	92.53

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 92.37 + — – —
= 92.37

The cash conversion cycle of Baxter International Inc has exhibited some fluctuations over the past few years. Initially, the company had a CCC of around 92 to 106 days from March 2020 to September 2021, indicating that it took Baxter an average of about 92 to 106 days to convert its investments in inventory and other resources into cash flows from sales.

Subsequently, there was a notable increase in the CCC to around 116 days by December 2021, which suggests that Baxter took longer to convert its resources into cash during that period. However, the CCC improved slightly in the following quarters, hovering around 102 to 110 days from March 2022 to March 2024.

The most significant improvement was observed in the last two quarters of 2024, where the CCC decreased to around 88 to 92 days, indicating that Baxter managed to streamline its cash conversion process and convert its resources into cash more efficiently during those periods.

Overall, while Baxter International Inc faced certain challenges in managing its cash conversion cycle in the past, the recent improvements suggest a better management of inventory, receivables, and payables, leading to a more efficient conversion of investments into cash flows in the latter half of 2024.