Burlington Stores Inc (BURL)
Cash conversion cycle
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 44.70 | 53.45 | 44.82 | 75.79 | 66.69 |
| Days of sales outstanding (DSO) | days | 2.79 | 2.98 | 2.12 | 3.94 | 4.58 |
| Number of days of payables | days | 39.30 | 43.22 | 47.44 | 88.26 | 65.13 |
| Cash conversion cycle | days | 8.19 | 13.21 | -0.51 | -8.53 | 6.14 |
February 3, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 44.70 + 2.79 – 39.30
= 8.19
The cash conversion cycle of Burlington Stores Inc has fluctuated over the past five years. In Fiscal Year 2020, the company had a positive cash conversion cycle of 6.14 days, indicating that it took 6.14 days to convert its investments in inventory into cash from sales. This improved further in Fiscal Year 2021, where the company managed to reduce this cycle to -8.53 days, implying that Burlington converted its investments into cash before actually paying for the inventory.
However, in Fiscal Year 2022, the cash conversion cycle turned positive again, with the company taking -0.51 days to convert investments into cash, but on a slightly longer timeline than the previous year. The trend continued in Fiscal Year 2023, as the cycle increased to 13.21 days, signifying a slower conversion of investments to cash.
Most recently, in Fiscal Year 2024, Burlington Stores Inc managed to reduce its cash conversion cycle to 8.19 days. This indicates that the company has made progress in streamlining its operations to improve efficiency in converting its investments in inventory to cash generated from sales, albeit still displaying a longer cycle compared to previous years.
Peer comparison
Feb 3, 2024