Lancaster Colony Corporation (LANC)
Cash conversion cycle
| Jun 30, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 37.75 | 34.43 | 33.81 | 37.86 | 34.26 | 33.99 | 31.04 | 37.88 | 33.54 | 40.39 | 40.23 | 43.16 | 34.38 | 30.62 | 33.17 | 34.07 | 26.67 | 30.03 | 28.49 | 29.82 |
| Days of sales outstanding (DSO) | days | 18.63 | 19.99 | 19.58 | 23.58 | 23.02 | 26.17 | 26.34 | 29.08 | 29.50 | 24.98 | 24.46 | 26.20 | 24.36 | 25.48 | 23.38 | 26.29 | 23.69 | 23.93 | 21.09 | 25.16 |
| Number of days of payables | days | 25.89 | 25.76 | 22.25 | 25.62 | 24.19 | 30.41 | 29.32 | 30.90 | 26.65 | 30.98 | 33.13 | 34.82 | 31.13 | 28.03 | 26.78 | 26.88 | 22.40 | 28.33 | 27.13 | 26.68 |
| Cash conversion cycle | days | 30.50 | 28.66 | 31.14 | 35.82 | 33.09 | 29.75 | 28.06 | 36.06 | 36.39 | 34.38 | 31.57 | 34.54 | 27.61 | 28.06 | 29.76 | 33.48 | 27.96 | 25.62 | 22.45 | 28.29 |
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 fluctuations over the past 20 quarters. The company's cash conversion cycle measures the time it takes to convert its investments in inventory into cash received from sales.
Looking at the trend in the data, we can see that the cash conversion cycle has ranged from a low of 22.45 days in December 2019 to a high of 36.39 days in June 2022. Overall, the trend appears to be somewhat cyclical, with periods of increase followed by periods of decrease.
The company's management of inventory, accounts receivable, and accounts payable impacts the cash conversion cycle. A shorter cash conversion cycle indicates that the company is efficiently managing its inventory and collections, and delaying payments to suppliers.
It is important for Lancaster Colony Corporation to consistently monitor and manage its cash conversion cycle to ensure efficient working capital management. Reducing the cash conversion cycle can lead to improved cash flow, profitability, and overall financial health of the company.
Peer comparison
Jun 30, 2024