Lancaster Colony Corporation (LANC)
Cash conversion cycle
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 37.75 | 34.26 | 33.53 | 34.38 | 26.67 |
| Days of sales outstanding (DSO) | days | 18.63 | 23.02 | 29.50 | 24.36 | 23.70 |
| Number of days of payables | days | 25.89 | 24.19 | 26.64 | 31.13 | 22.40 |
| Cash conversion cycle | days | 30.50 | 33.09 | 36.39 | 27.61 | 27.97 |
June 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 37.75 + 18.63 – 25.89
= 30.50
The cash conversion cycle of Lancaster Colony Corporation has shown fluctuating trends over the past five years. In the most recent fiscal year ending June 30, 2024, the company's cash conversion cycle decreased to 30.50 days compared to 33.09 days in the previous year. This indicates that the company was able to convert its inventory into cash more efficiently in the most recent period.
Looking back further, the trend shows an increasing cash conversion cycle from 27.61 days in June 30, 2021, to 36.39 days in June 30, 2022, before starting to decline again in the most recent year. This fluctuation suggests that the company has experienced variability in managing its inventory, accounts receivable, and accounts payable.
Overall, the downward trend in the cash conversion cycle over the last two years is a positive sign, indicating that Lancaster Colony Corporation has improved its efficiency in managing working capital and converting its assets into cash. It is essential for the company to continue monitoring and optimizing its cash conversion cycle to maintain its financial health and operational effectiveness.
Peer comparison
Jun 30, 2024