Franklin Electric Co Inc (FELE)
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 | 135.43 | 147.81 | 146.86 | 144.64 | 135.71 | 143.93 | 151.19 | 160.21 | 147.10 | 154.61 | 165.44 | 164.06 | 151.27 | 143.20 | 136.08 | 132.44 | 134.91 | 128.25 | 132.10 | 131.31 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 135.43 | 147.81 | 146.86 | 144.64 | 135.71 | 143.93 | 151.19 | 160.21 | 147.10 | 154.61 | 165.44 | 164.06 | 151.27 | 143.20 | 136.08 | 132.44 | 134.91 | 128.25 | 132.10 | 131.31 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 135.43 + — – —
= 135.43
The cash conversion cycle of Franklin Electric Co Inc has shown fluctuating trends over the past few years. It measures the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales.
Initially, in March 2020, the company had a cash conversion cycle of 131.31 days, which increased slightly to 132.10 days by June 2020. However, the cycle decreased to 128.25 days by September 2020 before reaching a peak of 164.06 days by March 2022. Subsequently, there was a downward trend observed, with the cycle declining to 135.43 days by December 2024.
The increasing trend in the cash conversion cycle from 2020 to 2022 may indicate a delay in receiving cash from sales or an increase in the time taken to convert inventory to sales. However, the significant decrease in the cycle from 2022 to 2024 suggests an improvement in the company's efficiency in managing inventory, receivables, and payables.
Overall, it is important for Franklin Electric Co Inc to continuously monitor its cash conversion cycle to ensure optimal management of working capital and efficient utilization of resources to enhance cash flows and profitability.
Peer comparison
Dec 31, 2024