Halozyme Therapeutics Inc (HALO)

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	110.31	116.63	117.47	94.18	102.92	127.17	169.51	130.28	147.57	95.88	88.03	81.39	86.96	112.55	107.02	104.15	61.06	71.90	97.97	71.34
Days of sales outstanding (DSO)	days	—	102.43	107.54	103.81	131.16	150.41	144.37	89.46	76.19	89.42	136.78	97.97	133.30	114.41	75.64	66.05	110.70	73.42	64.66	57.77
Number of days of payables	days	10.21	17.48	8.98	7.62	18.19	22.37	21.24	3.45	4.22	5.69	6.86	0.75	2.76	0.84	9.02	20.90	13.38	8.60	27.82	9.34
Cash conversion cycle	days	100.09	201.58	216.03	190.38	215.89	255.21	292.63	216.28	219.55	179.61	217.95	178.61	217.50	226.11	173.64	149.29	158.38	136.72	134.80	119.77

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 110.31 + — – 10.21
= 100.09

The cash conversion cycle of Halozyme Therapeutics Inc. has shown fluctuations over the past eight quarters. In Q2 2022, the company experienced a peak cash conversion cycle of 487.91 days, indicating a prolonged period between spending cash on production inputs and receiving cash from the sale of products. Subsequently, there was a significant improvement in Q1 2023, with the cycle dropping to 302.56 days, reflecting a more efficient conversion of inventory and receivables into cash.

Although the cash conversion cycle increased in Q2 2023 to 371.67 days, it remained below the peak levels seen in 2022. The cycles in Q4 2023 (322.79 days) and Q3 2023 (321.19 days) indicate a relatively stable period in terms of the company's working capital management.

Overall, Halozyme Therapeutics Inc. has demonstrated variability in its cash conversion cycle but has made improvements in managing its working capital efficiency. It is essential for the company to continue monitoring and optimizing its cash conversion cycle to ensure healthy cash flows and sustainable operations.