Leslies Inc (LESL)
Cash conversion cycle
| Sep 30, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 66.20 | 83.94 | 103.46 | 89.87 | 83.17 | 116.61 | 130.93 | 114.82 | 98.42 | 102.25 | 103.34 | 75.79 | 63.15 | |||
| Days of sales outstanding (DSO) | days | 14.15 | 15.07 | 10.67 | 7.17 | 9.30 | 14.15 | 15.75 | 12.09 | 11.88 | 12.50 | 12.11 | 11.75 | 12.21 | |||
| Number of days of payables | days | 19.11 | 30.26 | 30.69 | 17.10 | 15.62 | 39.38 | 37.18 | 31.35 | 42.58 | 61.95 | 48.19 | 30.84 | 32.07 | |||
| Cash conversion cycle | days | 61.24 | 68.75 | 83.44 | 79.94 | 76.85 | 91.38 | 109.50 | 95.57 | 67.73 | 52.80 | 67.26 | 56.71 | 43.29 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 66.20 + 14.15 – 19.11
= 61.24
The cash conversion cycle of Leslies Inc has fluctuated over the past several quarters. The cash conversion cycle represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. A shorter cash conversion cycle indicates that the company is more efficient in managing its working capital.
From the data provided, we can observe that the cash conversion cycle ranged from a low of 43.29 days on Dec 31, 2021, to a high of 109.50 days on Mar 31, 2023. This variability suggests fluctuations in inventory turnover, accounts receivable collection, and accounts payable management.
Notably, Leslies Inc experienced a significant increase in the cash conversion cycle between Mar 31, 2023, and Jun 30, 2023, indicating potential challenges in managing working capital during that period. However, the company was able to reduce the cash conversion cycle in subsequent quarters, showing improvements in efficiency.
Overall, an in-depth analysis of the components of the cash conversion cycle, such as days sales outstanding, days inventory outstanding, and days payables outstanding, would provide more insights into the specific areas where Leslies Inc can focus on to optimize its working capital management and enhance its overall financial performance.
Peer comparison
Sep 30, 2024