Carnival Corporation (CCL)

Cash conversion cycle

		Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020	Feb 29, 2020	Nov 30, 2019	Aug 31, 2019	May 31, 2019
Days of inventory on hand (DOH)	days	13.17	13.46	12.28	11.57	12.54	13.29	15.01	18.36	22.19	26.24	33.99	33.15	21.93	14.94	11.98	10.47	12.08	12.07	13.99	15.24
Days of sales outstanding (DSO)	days	11.51	10.45	9.90	10.57	14.22	13.65	16.82	29.28	39.09	71.04	156.83	572.45	140.82	18.60	13.65	13.36	7.13	7.86	7.91	7.50
Number of days of payables	days	27.37	29.78	28.05	27.54	28.61	32.60	32.88	39.40	43.71	58.74	70.93	53.71	35.49	27.84	23.72	52.34	24.83	21.38	20.17	24.09
Cash conversion cycle	days	-2.68	-5.86	-5.86	-5.39	-1.85	-5.66	-1.05	8.24	17.58	38.53	119.88	551.89	127.26	5.71	1.91	-28.51	-5.61	-1.44	1.73	-1.35

February 29, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 13.17 + 11.51 – 27.37
= -2.68

The cash conversion cycle of Carnival Corporation has shown fluctuations over the periods analyzed. A negative cash conversion cycle indicates that the company is efficient in managing its cash flow and working capital.

In recent periods, such as Feb 29, 2024, Nov 30, 2023, and Aug 31, 2023, Carnival Corporation had a significantly negative cash conversion cycle, indicating that it is effectively converting its inventory and accounts receivable into cash quickly, potentially benefiting from strong sales and efficient operations.

However, looking back to periods like Nov 30, 2021, and before, the company experienced significantly longer cash conversion cycles, reaching up to 551.89 days in May 31, 2021. This could suggest issues with inventory management, accounts payable, or accounts receivable collection during those periods.

Overall, Carnival Corporation has shown improvements in managing its cash conversion cycle in recent periods, but it should continue to monitor and optimize its working capital efficiency to maintain healthy cash flow and maximize profitability.