Ingersoll Rand Inc (IR)
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 | 91.49 | 100.75 | 104.04 | 109.42 | 104.23 | 104.67 | 108.77 | 105.70 | 98.54 | 104.72 | 100.92 | 107.29 | 99.07 | 187.16 | 226.05 | 297.45 | 148.01 | 122.77 | 122.97 | 120.65 |
| Days of sales outstanding (DSO) | days | 65.51 | 66.46 | 68.97 | 73.11 | 69.22 | 65.97 | 67.34 | 69.04 | 67.20 | 68.33 | 72.07 | 79.58 | 86.90 | 113.23 | 134.80 | 178.53 | 83.06 | 65.39 | 68.64 | 69.17 |
| Number of days of payables | days | 73.22 | 61.70 | 63.22 | 71.24 | 79.16 | 72.25 | 75.22 | 77.64 | 77.35 | 76.75 | 83.69 | 86.89 | 74.14 | 116.06 | 150.53 | 209.02 | 95.11 | 76.62 | 73.17 | 74.42 |
| Cash conversion cycle | days | 83.78 | 105.52 | 109.79 | 111.29 | 94.30 | 98.39 | 100.89 | 97.11 | 88.39 | 96.30 | 89.29 | 99.99 | 111.82 | 184.33 | 210.32 | 266.96 | 135.96 | 111.53 | 118.43 | 115.41 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 91.49 + 65.51 – 73.22
= 83.78
The cash conversion cycle of Ingersoll-Rand Inc fluctuated over the past eight quarters. In the most recent quarter, Q4 2023, the company's cash conversion cycle was 83.78 days, indicating that on average, it takes approximately 83.78 days for the company to convert its investments in inventory and other resources into cash from sales.
Comparing this to previous quarters, we observe a general improvement in the efficiency of the company's cash conversion cycle since Q1 2023, where it peaked at 111.29 days. The trend suggests that Ingersoll-Rand Inc has been managing its inventory, accounts receivable, and accounts payable more effectively to shorten the time it takes to generate cash from its operations.
Over the same period last year (Q4 2022 to Q1 2022), the company has reduced its cash conversion cycle from 94.30 days to 101.94 days. This improvement indicates that Ingersoll-Rand Inc has been making strides to streamline its operations and enhance its working capital management.
Despite some fluctuations, the overall trend in the cash conversion cycle of Ingersoll-Rand Inc seems to be moving in a positive direction, which could imply improved liquidity and financial performance for the company. It is essential for Ingersoll-Rand Inc to continue monitoring and optimizing its cash conversion cycle to ensure efficient operations and sustainable growth in the long run.
Peer comparison
Dec 31, 2023