KBR Inc (KBR)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 54.16 | 54.28 | 72.10 | 58.29 | 63.11 |
| Number of days of payables | days | 32.75 | 36.93 | 52.86 | 41.07 | 41.87 |
| Cash conversion cycle | days | 21.40 | 17.34 | 19.24 | 17.22 | 21.24 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 54.16 – 32.75
= 21.40
The cash conversion cycle of KBR Inc has shown some fluctuations over the past five years. In 2023, it increased to 21.40 days from 17.34 days in 2022, indicating a prolonged time period required to convert raw materials into cash. This may suggest possible inefficiencies in managing inventory, collecting receivables, or paying off payables.
Comparing to 2021, where the cash conversion cycle was 19.24 days, the increase in 2023 suggests a deterioration in the company's working capital management. However, it is worth noting that the cash conversion cycle in 2023 is lower than in 2019 when it was 21.24 days, indicating some improvement over the longer term.
Overall, KBR Inc should continue to monitor and potentially optimize its cash conversion cycle to enhance operational efficiency and liquidity management. A shorter cash conversion cycle typically indicates better working capital management and a more effective use of resources.
Peer comparison
Dec 31, 2023