Interpublic Group of Companies Inc (IPG)
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 | 68.86 | 9.95 | 10.69 | — | 0.14 | 0.37 | 0.41 | 0.73 | 0.20 | 0.09 | 0.12 | 0.12 | 0.02 | 0.53 | 0.68 | 0.44 | 0.57 | 0.58 | 0.67 | 0.51 |
| Days of sales outstanding (DSO) | days | 268.09 | 217.42 | 215.60 | 199.49 | 245.13 | 210.77 | 211.58 | 219.13 | 268.20 | 229.28 | 229.50 | 215.25 | 260.51 | 198.33 | 173.03 | 199.13 | 255.09 | 217.61 | 231.59 | 224.93 |
| Number of days of payables | days | 194.85 | 148.98 | 151.84 | 149.01 | 190.19 | 151.13 | 160.09 | 173.15 | 221.18 | 177.13 | 177.58 | 160.60 | 193.79 | 134.36 | 111.32 | 140.22 | 181.42 | 142.66 | 153.34 | 147.31 |
| Cash conversion cycle | days | 142.09 | 78.39 | 74.45 | 50.47 | 55.08 | 60.01 | 51.91 | 46.71 | 47.22 | 52.25 | 52.05 | 54.78 | 66.74 | 64.49 | 62.39 | 59.34 | 74.24 | 75.52 | 78.92 | 78.13 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 68.86 + 268.09 – 194.85
= 142.09
The cash conversion cycle for Interpublic Group Of Cos., Inc. has exhibited significant fluctuations over the past eight quarters. In Q4 2023, the cash conversion cycle stood at 268.09 days, indicating that it took the company approximately 268 days to convert its investments in inventory and other resources into cash from sales. This represents an increase from the previous quarter, where the cycle was 217.42 days.
The company's cash conversion cycle has generally been on an upward trend since Q1 2023, reaching a peak in Q4 2023. This trend suggests that Interpublic Group Of Cos., Inc. may be facing challenges in efficiently managing its working capital and converting its resources into cash.
It is noteworthy that in Q3 and Q4 of 2022, the cash conversion cycle reported negative values, indicating that the company was able to convert its resources into cash at a much faster rate than making investments in inventory and other operational expenses during those periods. This anomaly could be attributed to specific events or fluctuations in the company's operational activities during those quarters.
Overall, the analysis of the cash conversion cycle indicates that Interpublic Group Of Cos., Inc. may need to focus on improving its working capital management practices to enhance its liquidity position and operational efficiency.
Peer comparison
Dec 31, 2023