Cleveland-Cliffs Inc (CLF)
Cash conversion cycle
| Dec 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 93.58 | 75.81 | 73.37 | 76.18 | 75.93 | 78.22 | 79.92 | 83.33 | 88.75 | 100.92 | 111.34 | 116.31 | 115.02 | 115.56 | 135.58 | 161.18 | 253.74 | 175.99 | 279.10 | 456.39 |
| Days of sales outstanding (DSO) | days | 29.98 | 28.93 | 30.80 | 31.13 | 30.53 | 35.32 | 38.03 | 36.22 | 31.12 | 36.06 | 39.69 | 43.56 | 38.51 | 49.38 | 57.91 | 66.95 | 81.33 | 66.60 | 78.24 | 103.66 |
| Number of days of payables | days | 36.89 | 35.49 | 36.34 | 35.12 | 35.74 | 35.36 | 35.77 | 36.78 | 37.82 | 43.00 | 49.93 | 47.49 | 45.96 | 46.89 | 52.74 | 71.45 | 104.40 | 69.68 | 72.86 | 175.29 |
| Cash conversion cycle | days | 86.67 | 69.25 | 67.83 | 72.19 | 70.73 | 78.18 | 82.18 | 82.77 | 82.05 | 93.99 | 101.10 | 112.37 | 107.57 | 118.05 | 140.75 | 156.69 | 230.67 | 172.91 | 284.47 | 384.76 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 93.58 + 29.98 – 36.89
= 86.67
The cash conversion cycle of Cleveland-Cliffs Inc has shown a trend of improvement over the years, indicating more efficient management of working capital. The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash flow from sales.
From March 31, 2020 to December 31, 2024, the cash conversion cycle decreased significantly from 384.76 days to 86.67 days. This reduction demonstrates that Cleveland-Cliffs has been able to shorten the time it takes to convert its investments into cash, which can lead to improved liquidity and operational efficiency.
The most notable improvements in the cash conversion cycle occurred mainly in the earlier years of the analysis period, with a more gradual decline in the later years. Cleveland-Cliffs has managed to better streamline its operations, optimize inventory management, and accelerate the collection of receivables, all of which have contributed to the shorter cash conversion cycle.
Overall, the decreasing trend in the cash conversion cycle of Cleveland-Cliffs Inc is a positive indicator of the company's effectiveness in managing its working capital and converting its resources into cash efficiently.
Peer comparison
Dec 31, 2024