Johnson Controls International PLC (JCI)
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 | ||
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Days of inventory on hand (DOH) | days | 59.29 | 54.17 | 45.18 | 44.79 | 42.93 | 40.24 | 39.90 | 39.80 | 39.98 | 34.69 | 35.14 | 34.18 | 32.56 | 29.55 | 32.08 | 32.02 | 30.57 | 28.62 | 30.75 | 30.30 |
Days of sales outstanding (DSO) | days | 82.32 | 82.56 | 90.93 | 84.75 | 82.54 | 83.83 | 86.07 | 84.65 | 85.57 | 89.08 | 90.11 | 85.57 | 86.81 | 91.56 | 87.15 | 85.57 | 85.93 | 85.98 | 71.11 | 63.92 |
Number of days of payables | days | 78.43 | 83.29 | 62.77 | 63.89 | 61.36 | 65.95 | 63.94 | 64.90 | 67.32 | 63.18 | 63.31 | 58.58 | 54.63 | 52.00 | 49.13 | 49.19 | 52.22 | 56.52 | 55.07 | 49.68 |
Cash conversion cycle | days | 63.18 | 53.45 | 73.34 | 65.65 | 64.10 | 58.12 | 62.03 | 59.55 | 58.24 | 60.60 | 61.94 | 61.18 | 64.74 | 69.10 | 70.10 | 68.39 | 64.28 | 58.08 | 46.79 | 44.54 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 59.29 + 82.32 – 78.43
= 63.18
The cash conversion cycle (CCC) of Johnson Controls International plc has varied over the past few quarters. The CCC measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
In the most recent quarter, the CCC was 62.54 days, indicating that it took this many days for Johnson Controls to replenish its inventory, deliver products or services, and collect cash from customers. This represents an increase from the previous quarter, when the CCC was 51.26 days, suggesting that the company took longer to convert its investments into cash.
Looking further back, the CCC has fluctuated, reaching a peak of 64.67 days in the second quarter of 2023 and a low of 42.49 days in the third quarter of 2022. These fluctuations indicate changes in the efficiency of Johnson Controls' working capital management over time.
A rising CCC can indicate inefficiencies in inventory management or difficulties in collecting receivables. Conversely, a declining CCC may signal improved management of working capital. Companies with shorter cash conversion cycles are generally more efficient at managing their cash flows, while longer cycles may point to potential liquidity issues or challenges in the sales and collection process.
It would be important to further investigate the underlying reasons for the changes in the cash conversion cycle to gain a deeper understanding of the company's working capital management and potential implications for its overall financial performance.
Peer comparison
Dec 31, 2023
See also:
Johnson Controls International PLC Cash Conversion Cycle (Quarterly Data)