GE HealthCare Technologies Inc. (GEHC)
Cash conversion cycle
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 165.72 | 126.98 | |||
| Days of sales outstanding (DSO) | days | — | 0.11 | |||
| Number of days of payables | days | 249.17 | 165.52 | |||
| Cash conversion cycle | days | -83.45 | -38.43 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 165.72 + — – 249.17
= -83.45
The cash conversion cycle for GE HealthCare Technologies Inc. experienced a significant improvement from a negative 38.43 days as of September 30, 2023, to a more favorable negative 83.45 days as of December 31, 2023. This indicates that the company's efficiency in converting its investments in inventory and other resources into cash has improved, allowing it to operate with a shorter cash conversion cycle. A negative cash conversion cycle suggests that the company is able to collect cash from customers before it needs to pay its suppliers. This improvement may be attributed to more effective inventory management, quicker collection of accounts receivable, or extended payment terms with suppliers. Overall, the negative cash conversion cycle signifies that GE HealthCare Technologies Inc. is effectively managing its working capital and operating efficiently.
Peer comparison
Dec 31, 2023