Charles River Laboratories (CRL)

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	144.22	112.87	95.73	102.25	93.45
Days of sales outstanding (DSO)	days	69.76	67.01	68.66	76.70	72.66
Number of days of payables	days	64.07	90.86	95.24	67.44	64.85
Cash conversion cycle	days	149.91	89.03	69.15	111.52	101.26

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 144.22 + 69.76 – 64.07
= 149.91

The cash conversion cycle for Charles River Laboratories has fluctuated over the past five years, ranging from 69.15 days in 2021 to 149.91 days in 2023. The trend indicates that the company's efficiency in converting its resources into cash has varied significantly. In 2023, the cash conversion cycle increased substantially to 149.91 days, reflecting a potential slowdown in the company's cash generation and collection processes compared to the previous years. Additionally, the longer cash conversion cycle in 2023 may suggest inefficiencies in managing inventory levels, accounts receivable collection, or payment of accounts payable that need to be addressed to improve the company's overall liquidity position. Further analysis of the specific components contributing to this metric would provide deeper insights into the operational and financial performance of Charles River Laboratories.