Central Garden & Pet Company A (CENTA)
Cash conversion cycle
| 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 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 90.12 | 92.72 | 107.17 | 110.30 | 97.45 | 102.13 | 114.24 | 120.38 | 109.95 | 102.91 | 102.82 | 98.35 | 81.58 | 81.70 | 100.37 | 99.32 | 84.50 | 85.83 | 109.30 | 119.57 |
| Days of sales outstanding (DSO) | days | 37.54 | 56.21 | 63.80 | 40.83 | 36.71 | 55.06 | 63.25 | 36.35 | 41.19 | 54.60 | 66.42 | 37.00 | 42.57 | 56.65 | 77.56 | 42.48 | 53.05 | 71.75 | 69.15 | 40.73 |
| Number of days of payables | days | 25.28 | 22.57 | 27.82 | 24.68 | 22.19 | 23.41 | 26.62 | 22.82 | 25.28 | 28.11 | 34.41 | 28.50 | 29.23 | 30.91 | 41.61 | 37.49 | 39.45 | 36.02 | 39.49 | 39.68 |
| Cash conversion cycle | days | 102.38 | 126.36 | 143.16 | 126.45 | 111.97 | 133.78 | 150.87 | 133.91 | 125.86 | 129.40 | 134.83 | 106.85 | 94.92 | 107.44 | 136.32 | 104.32 | 98.10 | 121.56 | 138.96 | 120.62 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 90.12 + 37.54 – 25.28
= 102.38
The cash conversion cycle of Central Garden & Pet Company A has shown some fluctuations over the past few quarters. The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and receivables into cash flows from sales.
In the most recent quarter, ending September 30, 2024, the cash conversion cycle was 102.38 days. This indicates that the company takes approximately 102 days to convert its investments in inventory and receivables into cash. A lower cash conversion cycle is generally favorable as it means the company is able to collect cash quickly from its sales and manage its working capital efficiently.
Looking at the trend over the past few quarters, there seems to be some variability in the cash conversion cycle. The cycle peaked at 150.87 days in March 31, 2023, and was lowest at 94.92 days in September 30, 2021. This variability may suggest fluctuations in the company's working capital management efficiency and operational performance.
Overall, Central Garden & Pet Company A should aim to monitor and manage its cash conversion cycle effectively to ensure optimal working capital management, timely collection of receivables, and efficient inventory management. Efforts to streamline operations, improve inventory turnover, and shorten the cash conversion cycle can help enhance the company's liquidity and financial performance in the long run.
Peer comparison
Sep 30, 2024