ESCO Technologies Inc (ESE)
Cash conversion cycle
| 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 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 122.59 | 131.58 | 128.95 | 125.72 | 115.76 | 123.20 | 121.62 | 122.05 | 112.81 | 130.22 | 133.59 | 132.75 | 120.68 | 115.11 | 120.15 | 116.53 | 107.75 | 122.25 | 113.89 | 110.57 |
| Days of sales outstanding (DSO) | days | 86.84 | 78.80 | 69.98 | 73.98 | 76.52 | 75.28 | 73.07 | 66.21 | 70.48 | 76.73 | 66.97 | 68.12 | 74.79 | 68.84 | 64.24 | 72.76 | 72.27 | 66.64 | 73.22 | 73.54 |
| Number of days of payables | days | 57.66 | 50.04 | 50.01 | 48.38 | 54.70 | 49.13 | 52.13 | 49.54 | 54.70 | 51.71 | 54.77 | 51.20 | 46.48 | 41.54 | 38.93 | 35.75 | 40.24 | 43.60 | 43.30 | 43.79 |
| Cash conversion cycle | days | 151.78 | 160.34 | 148.92 | 151.32 | 137.59 | 149.35 | 142.57 | 138.71 | 128.59 | 155.24 | 145.79 | 149.66 | 148.99 | 142.42 | 145.47 | 153.54 | 139.79 | 145.29 | 143.81 | 140.32 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 122.59 + 86.84 – 57.66
= 151.78
The cash conversion cycle of ESCO Technologies Inc has displayed some fluctuations over the last several quarters.
The trend shows that the company's cash conversion cycle ranged between 128.59 days to 160.34 days during the specified period. This cycle represents the time it takes for the company to convert its investments in raw materials into cash receipts from sales. A shorter cash conversion cycle indicates improved efficiency in managing working capital, while a longer cycle suggests potential liquidity challenges or inefficiencies in the company's operations.
Looking at the data, it is observed that ESCO Technologies Inc experienced a peak in its cash conversion cycle during the quarter ended June 30, 2024, at 160.34 days, which was the highest over the period analyzed. On the other hand, the lowest cycle of 128.59 days was recorded in the quarter ended September 30, 2022.
Overall, ESCO Technologies Inc's cash conversion cycle has shown some variability, with a general upward trend in recent quarters. It is essential for the company to closely monitor and manage its working capital components, such as inventory, accounts receivable, and accounts payable, to optimize its cash conversion cycle and enhance its overall liquidity position.
Peer comparison
Sep 30, 2024