Cleveland-Cliffs Inc (CLF)
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 | 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 | 81.82 | 52.85 | 50.57 | 74.58 |
| Days of sales outstanding (DSO) | days | 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 | 27.99 | 37.92 | 39.31 | 21.72 |
| Number of days of payables | days | 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 | 49.81 | 51.74 | 43.43 | 40.95 |
| Cash conversion cycle | days | 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 | 59.99 | 39.04 | 46.44 | 55.34 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 75.93 + 30.53 – 35.74
= 70.73
The cash conversion cycle of Cleveland-Cliffs Inc has displayed fluctuations over the last eight quarters. In Q4 2023, the company's cash conversion cycle improved to 72.36 days, indicating that it took the company 72.36 days to convert its investments in inventory into cash receipts from customers. This was a positive trend compared to the previous quarters, where the cycle ranged from 79.55 days in Q3 2023 to 114.82 days in Q1 2022.
Overall, the downward trend in the cash conversion cycle from Q1 2022 to Q4 2023 suggests that Cleveland-Cliffs has become more efficient in managing its working capital. A shorter cash conversion cycle indicates that the company is collecting payments from customers more quickly and managing its inventory effectively.
It is worth noting that fluctuations in the cash conversion cycle can be influenced by various factors such as changes in sales trends, inventory management practices, and payment terms with customers. Monitoring the cash conversion cycle is crucial for assessing the company's liquidity and operational efficiency in converting its resources into cash flow.
Peer comparison
Dec 31, 2023