CNH Industrial N.V. (CNH)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 120.20 | 104.54 | 109.07 | 197.10 | 118.40 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 120.20 | 104.54 | 109.07 | 197.10 | 118.40 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 120.20 + — – —
= 120.20
The cash conversion cycle for CNH Industrial N.V. has shown fluctuations over the past five years. In 2023, the company's cash conversion cycle increased to 120.20 days compared to 104.54 days in 2022. This indicates that it took CNH Industrial N.V. longer to convert its investments in inventory and accounts receivable into cash during the most recent year.
In 2021, the cash conversion cycle was 109.07 days, showing a slight improvement from the previous year. However, in 2020, there was a significant increase in the cash conversion cycle to 197.10 days, which suggests potential inefficiencies in managing working capital.
The best performance in terms of cash conversion cycle was seen in 2019, where it stood at 118.40 days. This indicates that CNH Industrial N.V. was able to convert its investments into cash more efficiently during that period.
Overall, fluctuations in the cash conversion cycle may be influenced by factors such as inventory management, accounts receivable collection, and accounts payable turnover. CNH Industrial N.V. should closely monitor and manage these aspects to optimize its cash conversion cycle and improve overall liquidity and working capital efficiency.
Peer comparison
Dec 31, 2023