Graphic Packaging Holding Company (GPK)
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 | 77.73 | 75.64 | 74.25 | 73.14 | 69.40 | 69.29 | 72.15 | 75.34 | 74.77 | 69.06 | 67.01 | 71.75 | 75.41 | 79.20 | 84.22 | 81.71 | 78.94 | 77.00 | 79.39 | 77.28 |
| Days of sales outstanding (DSO) | days | 32.33 | 33.62 | 35.23 | 34.67 | 33.99 | 35.85 | 41.41 | 44.49 | 43.81 | 34.41 | 32.13 | 32.36 | 36.39 | 42.21 | 40.04 | 36.47 | 29.89 | 35.13 | 38.29 | 39.04 |
| Number of days of payables | days | 48.48 | 41.01 | 42.77 | 43.41 | 48.53 | 44.26 | 47.44 | 51.50 | 60.64 | 52.04 | 50.76 | 49.81 | 55.15 | 50.70 | 47.95 | 44.73 | 51.58 | 45.03 | 46.55 | 44.18 |
| Cash conversion cycle | days | 61.58 | 68.25 | 66.71 | 64.40 | 54.86 | 60.88 | 66.12 | 68.34 | 57.94 | 51.43 | 48.38 | 54.30 | 56.64 | 70.72 | 76.31 | 73.45 | 57.25 | 67.11 | 71.13 | 72.14 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 77.73 + 32.33 – 48.48
= 61.58
The cash conversion cycle of Graphic Packaging Holding Co has exhibited fluctuations over the past eight quarters, as shown in the table. The company's cash conversion cycle, which represents the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales, ranged from a low of 57.15 days in Q4 2022 to a high of 72.62 days in Q3 2023.
A lower cash conversion cycle indicates a more efficient management of working capital, as the company is able to quickly convert its investments back into cash. Conversely, a higher cash conversion cycle suggests a longer cash cycle, which may tie up a company's funds in inventory or accounts receivable for a longer period.
Overall, the trend in Graphic Packaging Holding Co's cash conversion cycle appears to have shown some variability, possibly influenced by factors such as changes in inventory management, sales trends, and payment terms with customers. Further analysis and monitoring of the cash conversion cycle in relation to industry benchmarks and historical performance could provide insights into the company's working capital management efficiency.
Peer comparison
Dec 31, 2023