International Paper (IP)

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 45.31 61.93 58.42 57.58 57.22 58.22 55.29 49.18 50.88 57.38 52.48 55.68 49.48 58.94 58.02 55.38 85.34 84.88 143.12 136.21
Days of sales outstanding (DSO) days 59.46 58.43 57.45 56.51 57.37 60.45 59.63 56.92 54.26 59.16 61.87 59.95 55.26 54.03 53.37 54.20 54.42 53.73 55.73 44.33
Number of days of payables days 58.57 75.86 73.19 75.45 79.79 78.61 78.05 74.84 73.09 75.57 73.64 71.70 61.92 65.37 63.68 65.80 93.65 90.87 160.75 149.05
Cash conversion cycle days 46.20 44.50 42.68 38.64 34.79 40.06 36.87 31.26 32.05 40.97 40.71 43.93 42.82 47.60 47.71 43.77 46.11 47.74 38.09 31.48

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 45.31 + 59.46 – 58.57
= 46.20

The cash conversion cycle of International Paper Co. has fluctuated over the past eight quarters. In Q4 2023, the company's cash conversion cycle was 44.22 days, showing a slight improvement compared to the previous quarter at 46.47 days. This indicates that the company took slightly less time to convert its investments in inventory and accounts receivable into cash during this period.

However, when compared to the same quarter in the previous year, the cash conversion cycle has increased from 38.18 days to 44.22 days in Q4 2023. This suggests that International Paper Co. may be facing challenges in managing its working capital efficiently, leading to a longer cash conversion cycle.

Overall, the trend in the cash conversion cycle shows some variability, with improvements in some quarters and deterioration in others. It is essential for the company to focus on optimizing its inventory and accounts receivable management to shorten the cash conversion cycle and improve its cash flow efficiency in the long term.


Peer comparison

Dec 31, 2023

Company name
Symbol
Cash conversion cycle
International Paper
IP
46.20
Mativ Holdings Inc.
MATV
67.94
Sylvamo Corp
SLVM
39.53