Cintas Corporation (CTAS)

Cash conversion cycle

		May 31, 2025	May 31, 2024	May 31, 2023	May 31, 2022	May 31, 2021
Days of inventory on hand (DOH)	days	31.61	30.49	119.39	120.06	124.04
Days of sales outstanding (DSO)	days	50.03	47.32	47.74	47.77	47.39
Number of days of payables	days	34.27	25.21	23.77	21.74	22.16
Cash conversion cycle	days	47.37	52.60	143.36	146.09	149.27

May 31, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 31.61 + 50.03 – 34.27
= 47.37

The analysis of Cintas Corporation's cash conversion cycle (CCC) over the specified period indicates significant fluctuations and a notable trend toward reduction. As of May 31, 2021, the CCC stood at approximately 149.27 days. This value decreased slightly to 146.09 days by May 31, 2022, and further declined to 143.36 days by May 31, 2023. This consistent downward trajectory suggests that the company was gradually improving the efficiency of its working capital management during this interval.

The decline becomes more pronounced in the subsequent years. By May 31, 2024, the CCC sharply reduced to approximately 52.60 days, representing a substantial decrease compared to the prior years. The trend culminates with a reported CCC of 0.00 days as of May 31, 2025, implying an arrangement wherein the company perhaps achieved near-instantaneous conversion of its resource inputs into cash flows, although this figure could be indicative of an error or a significant change in accounting practices or operational structure.

Overall, the progression indicates a remarkable improvement in Cintas' working capital efficiency, transitioning from a cycle that typically spanned over 140 days to a scenario where the cycle duration was effectively eliminated. Such a development suggests enhanced liquidity management, possibly driven by operational efficiencies, changes in receivables and payables management, or shifts in inventory turnover practices. However, the abrupt drop to zero days warrants further investigation to interpret accurately, as it may reflect extraordinary circumstances or data reporting nuances rather than a straightforward operational reality.