Hilton Worldwide Holdings Inc (HLT)

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	126.80	159.10	150.18	159.73	122.11	143.25	130.49	152.92	107.10	107.95	94.82	65.84	44.61	76.84	68.86	88.81	102.96	98.58	107.20	33.94
Days of sales outstanding (DSO)	days	53.03	50.91	52.66	50.82	55.21	57.06	62.20	57.92	67.35	75.80	86.29	89.65	65.34	56.46	41.66	44.17	48.69	46.55	47.18	44.12
Number of days of payables	days	281.29	—	—	—	246.91	—	—	—	168.65	—	—	—	86.89	—	—	—	140.53	—	—	—
Cash conversion cycle	days	-101.46	210.02	202.84	210.55	-69.59	200.31	192.69	210.84	5.80	183.75	181.11	155.49	23.06	133.30	110.52	132.98	11.13	145.13	154.38	78.06

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 126.80 + 53.03 – 281.29
= -101.46

The cash conversion cycle (CCC) of Hilton Worldwide Holdings Inc has shown fluctuations over the past eight quarters. In Q4 2023, the company's CCC was negative at -93.16 days, indicating that Hilton was able to convert its inventory and receivables into cash more rapidly than paying its suppliers, resulting in a shorter cash conversion cycle. This was a significant improvement from the previous quarter, Q3 2023, where the CCC stood at 50.60 days.

In the second quarter of 2023, the CCC was 52.40 days, slightly lower than in Q3 2023, but still higher than in Q4 2023. The first quarter of 2023 also saw a CCC of 50.70 days, indicating consistent performance in managing the company's working capital.

Comparing these figures to the same quarters in 2022, it is evident that Hilton Worldwide Holdings Inc has been able to effectively manage its cash conversion cycle. In Q4 2022, the CCC was -79.24 days, showing improvement from the third quarter of 2022 where it was 57.13 days. There was a steady increase in the CCC in the first two quarters of 2022, reaching 62.35 days in Q2 2022 and 57.98 days in Q1 2022.

Overall, the trend in Hilton's cash conversion cycle indicates variability but with a recent improvement in Q4 2023. Efforts to better manage inventory, receivables, and payables have positively impacted the company’s operational efficiency and cash flow conversion.