Enerpac Tool Group Corp (EPAC)
Cash conversion cycle
| Aug 31, 2024 | Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 92.21 | 90.01 | 99.86 | 96.33 | 91.44 |
| Days of sales outstanding (DSO) | days | 64.60 | 59.58 | 68.21 | 71.27 | 62.28 |
| Number of days of payables | days | 54.87 | 60.78 | 86.55 | 79.21 | 59.58 |
| Cash conversion cycle | days | 101.95 | 88.82 | 81.51 | 88.39 | 94.14 |
August 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 92.21 + 64.60 – 54.87
= 101.95
The cash conversion cycle of Enerpac Tool Group Corp has shown a fluctuating trend over the past five years. In the most recent fiscal year ending on August 31, 2024, the company's cash conversion cycle was 101.95 days, representing an increase from the previous year. This indicates that it takes Enerpac Tool Group Corp roughly 102 days to convert its investments in inventory and other resources into cash from sales.
Comparing this to the previous years, the cash conversion cycle was 88.82 days in 2023, 81.51 days in 2022, 88.39 days in 2021, and 94.14 days in 2020. The increasing trend in the cash conversion cycle from 2020 to 2024 suggests that the company may be taking longer to turn its resources into cash, which could potentially indicate inefficiencies in inventory management or collection processes.
It would be essential for Enerpac Tool Group Corp to thoroughly assess its working capital management practices to optimize the cash conversion cycle and enhance operational efficiency. Keeping this cycle as low as possible is crucial for maintaining healthy cash flows and ensuring the company's financial stability in the long run.
Peer comparison
Aug 31, 2024