Charles River Laboratories (CRL)

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	36.96	41.12	55.72	80.99	86.98	67.63	66.07	63.36	112.87	125.16	128.92	105.78	95.73	87.56	96.92	102.44	102.25	102.13	95.11	92.59
Days of sales outstanding (DSO)	days	64.40	67.63	68.53	70.66	69.69	67.61	68.07	—	66.88	74.93	74.84	71.55	68.61	72.32	74.09	76.04	78.84	75.65	72.05	74.12
Number of days of payables	days	18.62	16.63	21.25	29.07	38.64	31.47	32.47	28.96	90.86	86.92	106.13	108.07	95.24	61.64	55.32	67.28	67.44	54.49	46.87	58.36
Cash conversion cycle	days	82.74	92.12	103.01	122.57	118.03	103.77	101.67	34.41	88.89	113.17	97.63	69.25	69.10	98.24	115.69	111.20	113.65	123.30	120.29	108.35

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 36.96 + 64.40 – 18.62
= 82.74

The cash conversion cycle of Charles River Laboratories has shown some fluctuations over the periods provided. The company's cash conversion cycle measures the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales.

From March 31, 2020, to December 31, 2024, there were variations in the cash conversion cycle range from a high of 123.30 days in September 30, 2020, to a low of 34.41 days in March 31, 2023. Typically, a shorter cash conversion cycle indicates that the company is efficient in managing its working capital and converting its investments into cash quickly.

Some key points from the data include:
- At times, the cash conversion cycle exceeded 100 days, indicating that the company may have faced challenges in efficiently managing its working capital.
- There are instances where the cash conversion cycle improved significantly, such as in March 31, 2023, where it dropped substantially to 34.41 days.
- Overall, the trend in the cash conversion cycle seems to be fluctuating, with periods of improvement followed by slight increases.

The company should aim to consistently monitor and optimize its cash conversion cycle to ensure efficient management of working capital and maximize cash flows from operations.