Catalyst Pharmaceuticals Inc (CPRX)

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 28.37 20.51 28.66 32.21 26.66 29.82 35.41 37.38 40.17 36.68 39.51 24.86 27.71 29.44 11.61 14.48 16.53 6.38 3.86 2.37
Days of sales outstanding (DSO) days 49.05 50.34 51.56 47.53 17.79 17.77 20.53 25.06 17.15 18.11 18.10 17.02 18.35 18.14 20.61 21.22 37.59 50.70 90.63 204.40
Number of days of payables days 26.83 10.44 11.79 10.58 15.57 10.58 10.44 24.54 14.13 14.52 16.28 14.50 25.35 12.43 36.88 8.83 34.77 44.08 47.59 71.96
Cash conversion cycle days 50.59 60.41 68.44 69.17 28.88 37.02 45.49 37.89 43.20 40.26 41.33 27.37 20.71 35.15 -4.66 26.88 19.35 13.00 46.90 134.82

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 28.37 + 49.05 – 26.83
= 50.59

The cash conversion cycle of Catalyst Pharmaceuticals Inc shows fluctuations over the past few quarters. The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. A longer cash conversion cycle could indicate inefficiencies in managing working capital.

In December 2023, the cash conversion cycle was 50.59 days, which is an improvement from the previous quarter. This suggests that the company was able to manage its working capital more effectively during that period.

However, in September 2023, the cash conversion cycle increased to 60.41 days, indicating that it took the company longer to convert its investments into cash during that quarter. This trend continued into June 2023 and March 2023, with the cash conversion cycle reaching 68.44 days and 69.17 days, respectively.

Looking back further, in December 2022, the cash conversion cycle was lower at 28.88 days, reflecting efficient working capital management. But it increased in September 2022 and June 2022 to 37.02 days and 45.49 days, respectively, before decreasing again in March 2022 to 37.89 days.

The negative cash conversion cycle of -4.66 days in June 2020 indicates that the company was able to collect cash from sales before paying off its suppliers, potentially a sign of strong financial management.

Overall, Catalyst Pharmaceuticals Inc's cash conversion cycle has shown variability, with periods of both efficiency and inefficiency in managing its working capital. It is essential for the company to analyze the underlying reasons for these fluctuations and work towards maintaining a more consistent and efficient cash conversion cycle in the future.