Carter’s Inc (CRI)

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	218.71	313.27	301.94	226.61	260.21	340.58	357.66	295.06	358.60	159.01	192.83	196.78	185.90	287.12	204.27	182.04	173.64	130.74	131.72	103.86
Days of sales outstanding (DSO)	days	25.00	32.07	16.99	28.41	23.04	29.61	16.19	26.62	23.01	29.42	19.97	28.35	24.65	28.42	17.89	27.98	22.74	30.79	18.91	23.75
Number of days of payables	days	108.07	141.27	158.10	91.63	117.31	121.93	147.63	86.60	127.18	56.23	91.67	82.23	116.82	154.50	117.63	108.71	136.81	95.73	89.76	34.35
Cash conversion cycle	days	135.65	204.06	160.83	163.39	165.94	248.25	226.22	235.08	254.42	132.20	121.14	142.91	93.73	161.04	104.52	101.31	59.57	65.80	60.87	93.25

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 218.71 + 25.00 – 108.07
= 135.65

The cash conversion cycle of Carter’s Inc has shown fluctuations over the periods analyzed. The trend indicates that the company's ability to convert its resources effectively into cash has varied significantly.

The cycle was relatively stable in the beginning, around 60-90 days, but there was a notable increase in the period between September 2021 and December 2022, reaching its peak at 254.42 days. This suggests potential inefficiencies in managing the company's cash, inventory, and receivables during that time.

Subsequently, there was a gradual decline in the cash conversion cycle from December 2022 to June 2024, indicating improvements in the company's cash management processes. However, the cycle spiked again in September 2024 but remained lower compared to the prior peak.

Overall, Carter’s Inc may benefit from closely monitoring and controlling its cash conversion cycle to ensure optimal management of its working capital, which in turn can lead to improved financial performance and sustainability.