Crocs Inc (CROX)
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 | 41.58 | 43.41 | 44.82 | 47.13 | 47.67 | 48.78 | 55.51 | 61.37 | 63.19 | 77.40 | 86.16 | 80.27 | 47.31 | 49.52 | 53.25 | 56.80 | 53.82 | 58.04 | 49.70 | 64.12 |
| Days of sales outstanding (DSO) | days | 23.51 | 33.25 | 39.12 | 45.77 | 29.80 | 38.13 | 40.41 | 42.52 | 33.08 | 46.92 | 55.86 | 58.80 | 32.52 | 39.60 | 45.92 | 54.49 | 40.20 | 43.93 | 50.81 | 53.14 |
| Number of days of payables | days | 30.92 | 28.48 | 29.14 | 28.41 | 32.31 | 26.24 | 33.32 | 29.95 | 30.93 | 28.64 | 38.71 | 39.96 | 35.93 | 31.10 | 42.48 | 41.03 | 34.66 | 39.71 | 28.17 | 34.36 |
| Cash conversion cycle | days | 34.17 | 48.18 | 54.79 | 64.48 | 45.16 | 60.66 | 62.60 | 73.94 | 65.34 | 95.68 | 103.31 | 99.11 | 43.90 | 58.02 | 56.69 | 70.25 | 59.36 | 62.27 | 72.34 | 82.91 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 41.58 + 23.51 – 30.92
= 34.17
Crocs Inc's cash conversion cycle measures the number of days it takes for the company to convert its resources into cash. A shorter cash conversion cycle is generally favorable as it implies that the company is efficiently managing its working capital.
Looking at the historical trend of Crocs Inc's cash conversion cycle, there appears to be fluctuations in the duration over the periods provided. In March 2020, the cash conversion cycle stood at 82.91 days, indicating a relatively lengthy process from resource acquisition to cash realization. Over the subsequent quarters, there was a consistent decline in the cash conversion cycle, reaching its lowest point of 34.17 days by December 2024.
The improved efficiency in cash conversion cycle could suggest that Crocs Inc has been managing its inventory, accounts receivable, and accounts payable more effectively. A shorter cash conversion cycle means the company has been able to sell inventory, collect receivables, and pay suppliers at a quicker pace, which can lead to better cash flow and overall financial health.
It is important for Crocs Inc to continue monitoring and managing its cash conversion cycle to ensure optimal working capital management and sustainable financial performance. By maintaining a streamlined process of converting resources into cash, the company can enhance liquidity, reduce financial risks, and support its growth strategies in the long term.
Peer comparison
Dec 31, 2024