Eastman Chemical Company (EMN)
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 | 102.65 | 97.42 | 78.44 | 73.04 | 68.67 | 68.38 | 91.86 | 86.93 | 81.88 | 84.01 | 78.68 | 73.23 | 68.83 | 79.32 | 77.56 | 82.67 | 77.46 | 74.61 | 77.58 | 87.80 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 102.65 | 97.42 | 78.44 | 73.04 | 68.67 | 68.38 | 91.86 | 86.93 | 81.88 | 84.01 | 78.68 | 73.23 | 68.83 | 79.32 | 77.56 | 82.67 | 77.46 | 74.61 | 77.58 | 87.80 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 102.65 + — – —
= 102.65
The cash conversion cycle for Eastman Chemical Company has shown some fluctuations over the periods analyzed. It measures the time it takes for the company to convert its investments in inventory back into cash, reflecting the efficiency of its operations.
From March 31, 2020, to December 31, 2024, the cash conversion cycle ranged from a low of 68.38 days to a high of 102.65 days. The cycle peaked at the end of December 2024, indicating potential issues with managing inventory, collecting receivables, or both during that period.
Overall, the trend in the cash conversion cycle shows some variability, with periods of improvement followed by increases. It is important for Eastman Chemical Company to closely monitor and manage its working capital components to ensure a healthy cash conversion cycle, as a longer cycle can tie up cash and impact liquidity and profitability. Further analysis of the underlying reasons for the fluctuations in the cycle is necessary to implement strategies for optimization.
Peer comparison
Dec 31, 2024