Haemonetics Corporation (HAE)

Cash conversion cycle

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019
Days of inventory on hand (DOH)	days	101.49	101.76	99.13	103.25	95.08	95.81	99.00	112.47	117.12	122.95	132.75	139.01	145.18	134.86	131.26	120.60	102.39	96.10	94.09	86.01
Days of sales outstanding (DSO)	days	29.04	31.85	26.57	27.24	28.14	59.33	—	—	58.91	—	—	—	54.00	60.76	57.31	54.53	60.92	62.28	65.15	60.96
Number of days of payables	days	23.47	19.03	27.80	27.89	23.44	23.89	23.90	23.44	23.33	20.58	18.50	20.92	22.63	19.34	21.10	19.84	19.22	19.77	22.11	23.56
Cash conversion cycle	days	107.06	114.59	97.90	102.59	99.79	131.25	75.10	89.04	152.70	102.37	114.25	118.09	176.55	176.27	167.47	155.29	144.09	138.61	137.13	123.41

March 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 101.49 + 29.04 – 23.47
= 107.06

The cash conversion cycle of Haemonetics Corporation has shown fluctuations in recent periods. The cash conversion cycle measures the time it takes for a company to convert its investment in inventory and other resources into cash flows from sales.

The trend in the cash conversion cycle of Haemonetics Corporation indicates that the company has experienced variability in its liquidity management efficiency over the periods analyzed. A shorter cash conversion cycle is generally preferred as it signifies faster turnover of inventory and quicker conversion of sales into cash.

In the latest period, as of March 31, 2024, the cash conversion cycle stands at 107.06 days, showing some improvement compared to the previous quarter. However, it is important to note that this figure is still higher than some earlier periods, indicating that Haemonetics may be facing challenges in managing its working capital effectively.

Overall, Haemonetics Corporation should continue to monitor and potentially streamline its cash conversion cycle to enhance its liquidity position and optimize its use of resources. A consistent focus on improving inventory management, accounts receivable collection, and accounts payable strategies can help the company shorten its cash conversion cycle and strengthen its financial performance in the long run.