Cinemark Holdings Inc (CNK)
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 | 177.07 | 125.52 | 115.98 | 94.23 | 91.94 | 70.13 | 65.52 | 20.79 | 17.11 | 13.56 | 11.84 | 12.97 | 13.48 | 12.66 | 13.15 | 12.60 | 10.67 | 13.03 | 10.84 | 10.08 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | 14.83 | 19.04 | 21.26 | 31.15 | 33.32 | 59.01 | 336.92 | 105.82 | 29.46 | 23.43 | 9.27 |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | 66.11 | — | — | — | 59.85 | — | — | — |
| Cash conversion cycle | days | 177.07 | 125.52 | 115.98 | 94.23 | 91.94 | 70.13 | 65.52 | 20.79 | 17.11 | 28.40 | 30.87 | 34.23 | -21.47 | 45.98 | 72.16 | 349.52 | 56.64 | 42.49 | 34.27 | 19.35 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 177.07 + — – —
= 177.07
The cash conversion cycle is a financial metric that measures the time it takes for a company to convert its investments in inventory and other resources into cash inflows from sales. For Cinemark Holdings Inc, the cash conversion cycle has shown some fluctuations over the years.
From March 31, 2020, to December 31, 2021, the cash conversion cycle ranged from 19.35 days to -21.47 days. A negative cash conversion cycle typically indicates that the company is able to generate cash before having to pay its suppliers, which can be seen as a favorable situation.
However, from March 31, 2021, to June 30, 2024, the cash conversion cycle increased significantly, reaching a peak of 177.07 days by December 31, 2024. Such a long cash conversion cycle suggests that Cinemark Holdings Inc may be taking longer to turn its investments into cash, potentially facing delays in receiving payments from customers or difficulties in managing its inventory effectively.
Overall, the varying trends in the cash conversion cycle for Cinemark Holdings Inc indicate the need for the company to closely monitor its working capital management processes to improve efficiency in converting resources into cash inflows. A shorter cash conversion cycle would be beneficial for the company as it indicates faster cash generation and increased liquidity.