Garmin Ltd (GRMN)

Cash conversion cycle

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Days of inventory on hand (DOH)	days	143.85	159.05	193.35	160.72	120.40
Days of sales outstanding (DSO)	days	57.15	56.63	49.42	62.35	73.98
Number of days of payables	days	35.07	29.99	27.11	48.45	40.90
Cash conversion cycle	days	165.93	185.69	215.66	174.63	153.48

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 143.85 + 57.15 – 35.07
= 165.93

The cash conversion cycle for Garmin Ltd has shown fluctuations over the years as follows:
- As of December 31, 2020, the cash conversion cycle was 153.48 days.
- By December 31, 2021, it increased to 174.63 days.
- Subsequently, on December 31, 2022, the cycle extended further to 215.66 days.
- However, there was a slight improvement by December 31, 2023, with the cycle reducing to 185.69 days.
- Finally, as of December 31, 2024, the cash conversion cycle decreased to 165.93 days.

Overall, the trend indicates some volatility in managing cash, as there were periods of both increase and decrease in the cash conversion cycle. Efforts to streamline operations and manage working capital effectively may be necessary to stabilize the cycle for better cash flow management in the future.