H&R Block Inc (HRB)
Cash conversion cycle
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | 3.27 | 5.38 | — | 46.30 |
| Days of sales outstanding (DSO) | days | 6.17 | 6.98 | 10.08 | 27.54 | 56.80 |
| Number of days of payables | days | 25.20 | 28.56 | 30.34 | 31.22 | 39.25 |
| Cash conversion cycle | days | -19.03 | -18.30 | -14.88 | -3.69 | 63.85 |
June 30, 2025 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 6.17 – 25.20
= -19.03
The analysis of H&R Block Inc.'s cash conversion cycle over the specified periods reveals notable trends in the company's operational efficiency and liquidity management. As of June 30, 2021, the company's cash conversion cycle was 63.85 days, indicating that it took approximately two months and a few days to convert investments in inventory and receivables into cash flows from sales, while also accounting for the period of payables.
By June 30, 2022, the cycle had significantly shortened to -3.69 days, signaling a transition to a nearly cash-negative position. A negative cash conversion cycle suggests that the company is able to receive cash from customers faster than it needs to settle its payables, thereby effectively financing its operations through receivables and payables management.
This trend continued into subsequent years, with the cycle deepening to -14.88 days by June 30, 2023, and further to -18.30 days by June 30, 2024. As of June 30, 2025, the cycle reached -19.03 days, indicating a persistent shift towards a cash-efficient operating model. The negative values across these periods reflect increasingly efficient working capital management, potentially allowing the company to operate with reduced reliance on external financing or short-term borrowing.
In summary, H&R Block Inc. has demonstrated a marked improvement in its cash conversion cycle over recent years, consistently maintaining negative cycles that suggest enhanced operational efficiency and effective management of receivables, payables, and inventory. This ongoing trend toward a negative cash conversion cycle is indicative of a business model that benefits from accelerated cash inflows relative to outflows, supporting potentially improved liquidity positions and reduced working capital requirements.
Peer comparison
Jun 30, 2025