Biogen Inc (BIIB)

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	175.04	178.76	171.57	170.11	166.44	200.35	98.18	95.23	96.99	84.61	78.09	73.70	87.07	128.57	147.27	176.45	216.06	212.94	199.56	173.40
Days of sales outstanding (DSO)	days	52.99	—	—	—	61.75	—	—	59.04	61.17	55.25	53.81	55.06	51.50	56.65	52.67	53.70	51.96	51.82	53.75	52.96
Number of days of payables	days	30.18	30.60	24.27	26.16	26.56	29.57	32.79	36.52	35.46	23.58	26.23	24.18	37.96	40.81	44.05	64.81	91.98	82.55	80.42	78.54
Cash conversion cycle	days	197.85	148.16	147.30	143.95	201.64	170.79	65.38	117.75	122.70	116.28	105.66	104.58	100.61	144.41	155.89	165.34	176.04	182.21	172.90	147.82

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 175.04 + 52.99 – 30.18
= 197.85

Biogen Inc's cash conversion cycle, which represents the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales, has exhibited fluctuations over the period from March 31, 2020, to December 31, 2024.

The company's cash conversion cycle ranged from a high of 201.64 days on December 31, 2023, to a low of 65.38 days on June 30, 2023. During this period, there were peaks and valleys in the cycle, indicating potential challenges with managing inventory, accounts receivable, and accounts payable efficiently.

A higher cash conversion cycle suggests that the company is holding onto inventory or receivables for a longer period, which could tie up capital and impact liquidity. Conversely, a lower cycle indicates faster conversion of resources into cash, which can enhance the company's working capital management.

Overall, Biogen Inc should aim to monitor its cash conversion cycle closely and implement strategies to optimize inventory levels, streamline accounts receivable collections, and manage accounts payables effectively to improve cash flow and operational efficiency.