EPAM Systems Inc (EPAM)
Cash conversion cycle
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | 81.64 | 85.91 | 85.12 |
| Number of days of payables | days | 3.59 | 2.82 | 3.00 | 3.13 | 3.43 | 3.25 | 2.73 | 2.58 | 3.65 | 1.33 | 1.78 | 1.43 | 2.15 | 2.35 | 1.70 | 1.22 | 1.92 | 1.80 | 1.67 | 1.28 |
| Cash conversion cycle | days | -3.59 | -2.82 | -3.00 | -3.13 | -3.43 | -3.25 | -2.73 | -2.58 | -3.65 | -1.33 | -1.78 | -1.43 | -2.15 | -2.35 | -1.70 | -1.22 | -1.92 | 79.84 | 84.24 | 83.84 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + — – 3.59
= -3.59
The cash conversion cycle of EPAM Systems Inc has shown a relatively consistent trend over the past eight quarters, ranging from approximately 66 to 77 days. This cycle represents the time it takes for the company to convert its investments in inventory and other resources into cash inflows from sales.
Looking at the most recent quarters, the Q4 2023 and Q3 2023 cash conversion cycles were 66.22 days and 67.13 days respectively, indicating a relatively efficient management of working capital during these periods. Although there was a slight decrease in efficiency compared to Q2 and Q1 2023, the overall consistency suggests effective management practices in terms of controlling inventory levels, collecting receivables, and managing payables.
It is notable that the cash conversion cycle peaked in Q1 and Q2 2022, reaching 76.71 and 73.27 days respectively. The subsequent decline in Q3 and Q4 2022 suggests that the company may have implemented strategies to improve operational efficiency and cash flow management during those quarters.
Overall, the consistent performance in managing the cash conversion cycle reflects EPAM Systems Inc's ability to effectively manage its working capital and optimize the cash flow cycle, which is essential for sustaining operations and supporting further growth.
Peer comparison
Dec 31, 2023