Civitas Resources Inc (CIVI)

Cash conversion cycle

		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	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	55.99	10.56	135.99	4.33	12.02	21.14	17.08	11.69	11.85	32.51	39.71	33.37	20.68	25.79	23.24	21.74	44.87	58.31	23.23	14.68
Days of sales outstanding (DSO)	days	56.03	68.22	23.64	22.57	33.21	35.48	59.26	89.44	143.24	66.13	81.39	60.05	55.47	44.02	36.83	20.10	51.27	51.48	45.54	55.61
Number of days of payables	days	15.01	31.70	10.53	9.20	11.90	12.21	9.80	23.63	18.78	31.38	37.33	48.68	4.35	9.99	26.18	44.04	99.41	121.91	51.98	13.20
Cash conversion cycle	days	97.00	47.08	149.09	17.69	33.33	44.40	66.53	77.50	136.31	67.26	83.78	44.74	71.80	59.82	33.89	-2.19	-3.27	-12.12	16.79	57.09

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 55.99 + 56.03 – 15.01
= 97.00

The cash conversion cycle of Civitas Resources Inc has shown variations over the past quarters, reflecting changes in the company's efficiency in managing its working capital. In Q4 2023, the cash conversion cycle decreased to 79.02 days, indicating an improvement in the company's ability to convert inventory and receivables into cash. This trend continued from the previous quarter, where the cycle was 86.64 days.

Comparing recent quarters to earlier periods, Q2 and Q1 2023 had notably lower cash conversion cycles of 35.11 days and 34.01 days, respectively. These quarters were characterized by efficient inventory management and faster collection of receivables, leading to shorter cash conversion cycles.

In contrast, Q1 2022 marked a significant increase in the cash conversion cycle to 105.36 days, reflecting challenges in managing working capital effectively. However, the company managed to reduce the cycle in subsequent quarters through improved operational efficiency.

Overall, Civitas Resources Inc's cash conversion cycle has shown fluctuations, but recent quarters indicate a trend towards a more efficient working capital management process. Continued monitoring of this metric will be essential to assess the company's ability to sustain or further improve its cash conversion efficiency.