Grocery Outlet Holding Corp (GO)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 33.14 | 35.36 | 33.83 | 29.94 | 32.55 |
| Days of sales outstanding (DSO) | days | 1.77 | 1.56 | 1.24 | 1.33 | 1.43 |
| Number of days of payables | days | 19.82 | 14.56 | 14.99 | 13.95 | 17.69 |
| Cash conversion cycle | days | 15.09 | 22.36 | 20.07 | 17.32 | 16.30 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 33.14 + 1.77 – 19.82
= 15.09
The cash conversion cycle for Grocery Outlet Holding Corp has shown fluctuations over the past five years. In 2023, the company's cash conversion cycle improved to 15.09 days compared to 22.36 days in 2022. This indicates that the company took less time to convert its investments in inventory into cash receipts from sales and then into cash payments for inventory purchases.
In 2021 and 2020, the cash conversion cycle was relatively stable at 20.07 days and 17.32 days, respectively. This suggests that the company's efficiency in managing its working capital and operations remained consistent during these years.
In 2019, Grocery Outlet Holding Corp had a cash conversion cycle of 16.30 days, showing a slight improvement from the previous year. This indicates that the company was able to manage its cash flow more effectively in converting its resources into cash.
Overall, a decreasing trend in the cash conversion cycle is generally positive, as it signifies that the company is improving its liquidity and working capital management. The fluctuations in the cash conversion cycle for Grocery Outlet Holding Corp over the years may be influenced by various factors such as changes in sales volumes, inventory turnover, and payment terms with suppliers and customers.
Peer comparison
Dec 31, 2023