Fortune Brands Innovations Inc. (FBIN)
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 | 89.38 | 93.16 | 105.72 | 112.29 | 133.61 | 192.22 | 182.42 | 169.28 | 114.30 | 129.89 | 109.69 | 95.82 | 80.63 | 70.68 | 72.71 | 68.39 | 70.66 | 75.01 | 74.30 | 75.24 |
| Days of sales outstanding (DSO) | days | 42.15 | 45.94 | 50.04 | — | 40.33 | 71.05 | 74.63 | 76.00 | 67.33 | 64.18 | 54.81 | 52.40 | 44.04 | 47.33 | 42.06 | 42.39 | 39.56 | 40.88 | 45.73 | 42.69 |
| Number of days of payables | days | 51.69 | 57.14 | 54.22 | 51.10 | 55.15 | 86.06 | 95.36 | 92.34 | 72.09 | 84.70 | 73.09 | 59.91 | 57.69 | 52.09 | 46.06 | 41.47 | 45.23 | 43.15 | 47.73 | 45.07 |
| Cash conversion cycle | days | 79.84 | 81.97 | 101.54 | 61.19 | 118.78 | 177.21 | 161.68 | 152.94 | 109.54 | 109.37 | 91.41 | 88.32 | 66.98 | 65.92 | 68.71 | 69.31 | 64.99 | 72.74 | 72.30 | 72.86 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 89.38 + 42.15 – 51.69
= 79.84
The cash conversion cycle of Fortune Brands Innovations Inc. shows fluctuations over the analyzed periods. It measures the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales, indicating its efficiency in managing working capital.
- The company's cash conversion cycle varied between 61.19 days and 177.21 days during the period under review. A shorter cycle is generally preferable as it indicates quicker cash generation from operating activities.
- The cycle was longest in September 2022 at 177.21 days, suggesting the company took a significant amount of time to convert its resources into cash receipts, potentially indicating inefficiencies in managing inventories and collecting receivables.
- On the other hand, in March 2021, the cycle was the shortest at 66.98 days, indicating improved efficiency in managing working capital and converting resources into cash.
- Overall, understanding the factors driving these fluctuations can help the company improve its working capital management, streamline operations, and enhance cash flow performance in the future.
Peer comparison
Dec 31, 2023