ELF Beauty Inc (ELF)

Cash conversion cycle

		Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021	Mar 31, 2020
Days of inventory on hand (DOH)	days	78.27	57.64	83.29	65.31	65.07
Days of sales outstanding (DSO)	days	44.43	43.00	42.71	46.71	39.23
Number of days of payables	days	33.14	22.27	18.95	18.05	17.45
Cash conversion cycle	days	89.57	78.36	107.05	93.97	86.85

March 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 78.27 + 44.43 – 33.14
= 89.57

ELF Beauty Inc's cash conversion cycle has fluctuated over the past five years. The company's cash conversion cycle in 2024 stands at 89.57 days, an increase from the prior year. This metric indicates that it takes the company approximately 89.57 days to convert its investments in inventory and other resources into cash flows from sales.

Comparing this figure to previous years, we observe that in 2023, the cash conversion cycle was 78.36 days, showing an improvement from the current year. However, in 2022, the cycle increased significantly to 107.05 days, reflecting a longer period required to convert investments into cash.

In 2021, the cycle was 93.97 days, indicating a slight decrease from the previous year. The trend continues in 2020, where the company's cash conversion cycle stood at 86.85 days, showing a shorter cycle compared to the most recent year.

Overall, the fluctuation in ELF Beauty Inc's cash conversion cycle suggests varying efficiencies in managing its working capital and converting assets into cash over the years. Further analysis and comparisons with industry benchmarks can provide more insights into the company's operational effectiveness and potential areas for improvement.