Belden Inc (BDC)
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 | 81.38 | 86.02 | 73.76 | 82.38 | 76.72 |
| Days of sales outstanding (DSO) | days | 60.77 | 60.13 | 61.63 | 60.82 | 61.83 |
| Number of days of payables | days | 74.89 | 80.45 | 75.60 | 90.15 | 75.73 |
| Cash conversion cycle | days | 67.26 | 65.70 | 59.80 | 53.05 | 62.82 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 81.38 + 60.77 – 74.89
= 67.26
The cash conversion cycle of Belden Inc has shown some fluctuations over the past five years. In 2020, the cash conversion cycle was 62.82 days, indicating that, on average, it took Belden Inc approximately 62.82 days to convert its investments in raw materials, manufacturing, and distribution back into cash from sales.
By the end of 2021, the cash conversion cycle improved to 53.05 days, suggesting that the company was able to manage its working capital more efficiently, leading to a quicker conversion of inventory into cash receipts from customers.
However, in 2022, the cash conversion cycle increased slightly to 59.80 days, which may indicate potential challenges in managing inventory levels, receivables collection, or payment of liabilities.
In 2023, the cash conversion cycle further increased to 65.70 days, showing a prolonged period for Belden Inc to convert its resources back into cash, potentially signaling inefficiencies in working capital management.
By the end of 2024, the cash conversion cycle spiked to 67.26 days, reflecting a further delay in converting assets into cash. This increase could potentially strain the company's liquidity and working capital position if not addressed.
Overall, the trend in Belden Inc's cash conversion cycle suggests fluctuations in working capital efficiency over the years, indicating the need for the company to closely monitor and optimize its inventory, accounts receivable, and accounts payable processes to enhance cash flow management.
Peer comparison
Dec 31, 2024