ConAgra Foods Inc (CAG)

Cash conversion cycle

		May 31, 2025	May 31, 2024	May 26, 2024	May 31, 2023	May 28, 2023
Days of inventory on hand (DOH)	days	86.84	87.21	61.93	89.60	67.26
Days of sales outstanding (DSO)	days	24.20	26.41	27.37	28.33	29.34
Number of days of payables	days	67.41	62.54	44.41	61.78	46.38
Cash conversion cycle	days	43.63	51.08	44.89	56.14	50.22

May 31, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 86.84 + 24.20 – 67.41
= 43.63

The cash conversion cycle (CCC) of ConAgra Foods Inc. over the period under review demonstrates relatively stable but fluctuating operational efficiency. As of May 28, 2023, the CCC was 50.22 days, indicating the average time it takes the company to convert its investments in inventory and receivables into cash, net of its payables. By May 31, 2023, the CCC increased to 56.14 days, suggesting a slowdown in converting inventory and receivables into cash or an elongation in the cash cycle, potentially due to longer receivables collection periods, inventory holding periods, or shorter payables.

Looking forward, the data from the subsequent year indicates an improvement in the cash conversion cycle. As of May 26, 2024, the CCC decreased to 44.89 days, reflecting enhanced efficiency in managing working capital. This reduction persisted into May 31, 2024, with the CCC slightly increasing to 51.08 days, but still remaining below the May 2023 levels. The latest data point as of May 31, 2025, indicates a further reduction to 43.63 days, signaling continued improvement in the cash cycle efficiency.

Overall, the trend illustrates efforts to optimize working capital management, with the company achieving a shorter cash conversion cycle over the recent period. This suggests improved inventory turnover, faster receivables collection, or extended payables periods, all contributing to more efficient cash flow management. The fluctuations observed may be attributable to seasonal factors, strategic operational changes, or external market conditions affecting the company's working capital performance.