Interpublic Group of Companies Inc (IPG)
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 | — | 118.75 | 0.24 | 0.36 | 0.04 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 0.00 | 118.75 | 0.24 | 0.36 | 0.04 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + — – —
= 0.00
The cash conversion cycle is a financial metric that represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. Looking at the trend for Interpublic Group of Companies Inc over the years, we see that the cash conversion cycle has fluctuated.
On December 31, 2020, the cash conversion cycle was extremely low at 0.04 days, indicating that the company was efficient in managing its working capital and converting investments into cash quickly. However, in the following years, there was some variability in the cash conversion cycle.
By December 31, 2021, the cash conversion cycle increased to 0.36 days, suggesting a slight slowdown in the conversion of resources into cash. This trend continued into December 31, 2022, with a slightly lower cycle of 0.24 days, indicating some improvement in efficiency compared to the previous year.
A significant spike in the cash conversion cycle was observed by December 31, 2023, reaching 118.75 days. Such a substantial increase could indicate potential challenges in managing inventory, receivables, or payables effectively, leading to a prolonged time to convert investments into cash.
Finally, by December 31, 2024, the cash conversion cycle dropped back to 0.00 days, suggesting a return to high efficiency in converting resources into cash within the same timeframe, similar to the level observed in 2020.
In conclusion, while Interpublic Group of Companies Inc experienced fluctuations in its cash conversion cycle over the years, it is essential for the company to closely monitor and manage its working capital components to ensure efficient cash flow operations and overall financial health.
Peer comparison
Dec 31, 2024