Incyte Corporation (INCY)

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	68.86	90.14	74.05	67.45	45.65
Days of sales outstanding (DSO)	days	—	—	—	—	—
Number of days of payables	days	230.96	156.89	489.40	416.05	274.50
Cash conversion cycle	days	-162.10	-66.75	-415.35	-348.60	-228.85

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 68.86 + — – 230.96
= -162.10

Incyte Corporation's cash conversion cycle has exhibited fluctuating trends over the past five years. The cycle, which represents the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales, has shown a significant improvement from -228.85 days as of December 31, 2020, to -415.35 days as of December 31, 2022. This suggests that the company has been able to manage its working capital more efficiently and retrieve cash from its operational activities at a faster pace over this period.

However, the cash conversion cycle experienced a notable decline to -66.75 days as of December 31, 2023, indicating a more rapid cash conversion process compared to the previous year. This sudden decrease may have been influenced by changes in inventory management, accounts receivable collection, or accounts payable policies.

By December 31, 2024, the cash conversion cycle improved slightly to -162.10 days, albeit not reflecting the record low observed in 2022. Overall, Incyte Corporation has demonstrated a generally favorable cash conversion cycle performance, albeit with some fluctuations, indicating a proficient management of working capital and operational cash flows over the analyzed period.