Incyte Corporation (INCY)
Cash conversion cycle
| Dec 31, 2024 | Sep 30, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 70.41 | 92.89 | 89.65 | 90.14 | 85.42 | 54.85 | 67.45 | 74.05 | 87.33 | 112.40 | 78.82 | 67.45 | 54.21 | 44.14 | 45.75 | 45.65 | 48.81 | 48.50 | 42.88 | 36.42 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | 236.17 | 235.66 | 231.34 | 156.89 | 208.20 | 237.64 | 91.80 | 489.40 | 310.67 | 401.66 | 338.71 | 416.05 | 291.38 | 323.20 | 233.03 | 274.50 | 351.49 | 269.91 | 186.94 | 267.23 |
| Cash conversion cycle | days | -165.76 | -142.77 | -141.70 | -66.75 | -122.78 | -182.79 | -24.35 | -415.35 | -223.34 | -289.26 | -259.89 | -348.60 | -237.17 | -279.06 | -187.28 | -228.85 | -302.68 | -221.41 | -144.06 | -230.81 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 70.41 + — – 236.17
= -165.76
The cash conversion cycle of Incyte Corporation has shown fluctuations over the period analyzed. The company's cash conversion cycle reflects how efficiently it is able to convert its investments in raw materials and other inputs into cash inflows from sales.
From December 31, 2019, to September 30, 2022, Incyte Corporation maintained a negative cash conversion cycle, indicating that it was able to convert its investment in inventory into cash quickly, potentially due to efficient inventory management practices or strong sales. This period saw some variation in the number of days, with the cycle lengthening slightly in some quarters and shortening again in others.
However, by December 31, 2022, the cash conversion cycle significantly increased to -415.35 days, suggesting a potential inefficiency in managing cash flow and converting investments into sales. This extended cycle length indicates that the company might be facing challenges in optimizing its working capital and converting its investments into cash inflows efficiently.
The cycle then improved in the subsequent quarters, with fluctuations continuing until December 31, 2024. The negative cash conversion cycle recorded on March 31, 2024, indicated a return to a more efficient cash conversion process, although it remained negative, reflecting that the company continued to convert its investments into cash inflows faster than the typical industry standard.
Overall, monitoring the cash conversion cycle can provide insights into Incyte Corporation's operational efficiency and working capital management. An increasing cycle may indicate potential liquidity challenges or inefficiencies in the company's operations, while a decreasing or consistently negative cycle suggests effective working capital management and efficient cash flow conversion processes.
Peer comparison
Dec 31, 2024