Balchem Corporation (BCPC)
Cash conversion cycle
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 77.32 | 64.44 | 65.99 | 59.79 | 53.73 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 77.32 | 64.44 | 65.99 | 59.79 | 53.73 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 77.32 + — – —
= 77.32
The cash conversion cycle of Balchem Corporation has shown an increasing trend over the years, starting at 53.73 days as of December 31, 2020, and reaching 77.32 days by December 31, 2024. This indicates that the company is taking longer to convert its investments in raw materials and other inputs into cash from sales.
A longer cash conversion cycle may suggest inefficiencies in the company's operations, such as slower collections from customers, longer inventory turnover, or delayed payments to suppliers. It can also indicate that the company is facing challenges in managing its working capital effectively.
Balchem Corporation should closely monitor its cash conversion cycle and identify opportunities to streamline processes, improve inventory management, accelerate collections, and optimize payment terms with suppliers to enhance its cash flow and overall financial health.
Peer comparison
Dec 31, 2024