Krystal Biotech Inc (KRYS)
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 | 85.11 | 25.91 | — | — | — |
| Days of sales outstanding (DSO) | days | 128.86 | 275.17 | — | — | — |
| Number of days of payables | days | 16.00 | 15.33 | 18.69 | 75.89 | 51.01 |
| Cash conversion cycle | days | 197.96 | 285.75 | -18.69 | -75.89 | -51.01 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 85.11 + 128.86 – 16.00
= 197.96
The cash conversion cycle of Krystal Biotech Inc has exhibited fluctuations over the years. In December 2020, the company had a negative cash conversion cycle of -51.01 days, indicating efficient management of cash flows from operations, inventory, and accounts payable.
However, by December 2021, the cash conversion cycle extended to -75.89 days, suggesting a delay in converting investments in inventory and accounts payables into cash. This trend continued into December 2022 with a further increase to -18.69 days.
By December 2023, there was a significant shift to a positive cash conversion cycle of 285.75 days, which could be attributed to challenges in managing working capital effectively. This prolonged cycle may signify inefficiencies in the collection of receivables or management of inventory and payables.
In December 2024, although the cash conversion cycle improved to 197.96 days, it remained a concern as it indicates a relatively long period for the company to convert its investments in inventory and accounts payables into cash.
Overall, Krystal Biotech Inc should focus on optimizing its working capital management to ensure a healthy cash conversion cycle and enhance its liquidity position.
Peer comparison
Dec 31, 2024