Krystal Biotech Inc (KRYS)
Cash conversion cycle
| Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 41.17 | 26.41 | 20.19 | 4.38 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 165.91 | 271.24 | 363.09 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | 19.99 | 15.62 | 16.60 | 17.71 | 17.94 | 19.17 | 32.05 | 60.98 | 63.51 | 78.72 | 55.22 | 17.45 | 33.70 | 55.96 | 77.69 | 65.05 | 31.33 | 57.43 | 79.95 | 63.10 |
| Cash conversion cycle | days | 187.09 | 282.02 | 366.68 | -13.33 | -17.94 | -19.17 | -32.05 | -60.98 | -63.51 | -78.72 | -55.22 | -17.45 | -33.70 | -55.96 | -77.69 | -65.05 | -31.33 | -57.43 | -79.95 | -63.10 |
March 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 41.17 + 165.91 – 19.99
= 187.09
The cash conversion cycle of Krystal Biotech Inc has displayed significant fluctuations over the past two years. The cycle measures the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales, reflecting its efficiency in managing working capital.
From March 2019 to December 2020, the company's cash conversion cycle ranged from -79.95 days to -17.45 days, indicating that Krystal Biotech Inc was able to convert its investments into cash quickly, even before paying for its own inventory. This negative cycle reflects efficient working capital management and a strong cash position.
However, starting from March 2021, the cash conversion cycle turned positive, reaching a peak of 366.68 days in September 2023. This significant increase suggests that the company took longer to convert its investments into cash during this period, potentially due to challenges in inventory management, slow collection of receivables, or delays in the sales cycle.
The cycle then decreased to 187.09 days by March 2024. While the trend is moving in the right direction, the company should continue monitoring and improving its working capital efficiency to ensure that it maintains a healthy cash conversion cycle. This may involve streamlining operations, optimizing inventory levels, and implementing effective credit and collection policies.
Peer comparison
Mar 31, 2024