Liberty Oilfield Services Inc (LBRT)

Cash conversion cycle

		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	Mar 31, 2019
Days of inventory on hand (DOH)	days	20.93	20.94	19.80	20.11	23.47	22.12	21.61	19.92	20.66	21.71	29.25	44.40	44.95	26.10	21.71	18.82	18.75	18.08	18.10	15.24
Days of sales outstanding (DSO)	days	14.52	15.51	15.13	57.90	51.55	69.93	67.00	69.27	60.19	77.56	108.01	119.01	127.99	47.65	16.97	63.55	46.38	43.53	59.94	53.41
Number of days of payables	days	29.87	35.46	36.32	42.18	35.77	45.09	41.12	47.56	44.33	42.56	44.58	63.44	73.30	23.73	7.32	23.23	24.90	18.92	22.53	25.15
Cash conversion cycle	days	5.59	0.99	-1.38	35.83	39.25	46.96	47.49	41.63	36.52	56.71	92.69	99.97	99.64	50.02	31.35	59.15	40.23	42.69	55.50	43.51

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 20.93 + 14.52 – 29.87
= 5.59

The cash conversion cycle of Liberty Energy Inc has shown fluctuations over the past eight quarters. Generally, the company has managed to keep its cash conversion cycle relatively low, with Q1 2023 having the shortest cycle at 16.35 days. This indicates that the company is efficient in converting its inventory and receivables into cash.

However, there have been periods where the cash conversion cycle has increased, such as Q3 2022 and Q4 2023, where it peaked at 25.36 days and 23.29 days respectively. This could suggest potential issues in managing inventory, collecting receivables, or delaying payments to suppliers during those periods.

Overall, Liberty Energy Inc should continue to monitor and improve its cash conversion cycle to ensure efficient use of its working capital and maintain healthy cash flows.