Brunswick Corporation (BC)
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 | 97.43 | 93.81 | 89.77 | 82.89 | 100.74 |
| Days of sales outstanding (DSO) | days | 28.12 | 29.09 | 30.30 | 28.34 | 29.48 |
| Number of days of payables | days | 36.81 | 42.25 | 51.54 | 53.29 | 48.08 |
| Cash conversion cycle | days | 88.74 | 80.66 | 68.53 | 57.94 | 82.14 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 97.43 + 28.12 – 36.81
= 88.74
The cash conversion cycle for Brunswick Corp. has shown fluctuations over the past five years. In 2023, the company's cash conversion cycle increased to 100.80 days from 89.77 days in 2022, indicating that it took longer for the company to convert its investments in inventory and accounts receivable into cash during the most recent year. This could potentially signal challenges in efficiently managing working capital and converting assets into cash.
Comparing to the previous years, the cash conversion cycle was significantly higher in 2019 at 82.14 days, then decreased to 57.94 days in 2020, before increasing again in the following years. This fluctuation suggests that Brunswick Corp. may have experienced variations in its inventory turnover, accounts receivable collection, and accounts payable management over the five-year period.
Overall, the trend in the cash conversion cycle for Brunswick Corp. indicates the need for a closer look at the company's working capital management strategies to improve operational efficiency and liquidity in the future.
Peer comparison
Dec 31, 2023