Lumen Technologies Inc (LUMN)
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 | ||
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Days of inventory on hand (DOH) | days | 2.94 | 2.89 | 2.59 | 3.98 | 4.14 | 4.46 | 3.73 | 3.11 | 2.27 | 1.76 | 1.90 | 1.64 | 1.70 | 3.15 | 3.33 | 3.18 | 1.42 | 1.85 | 2.02 | 2.02 |
Days of sales outstanding (DSO) | days | 40.87 | 37.71 | 36.62 | 31.60 | 32.20 | 29.89 | 28.55 | 27.11 | 30.18 | 28.45 | 34.56 | 33.61 | 36.30 | 37.07 | 38.50 | 38.12 | 38.88 | 38.20 | 41.28 | 38.47 |
Number of days of payables | days | 15.93 | 12.93 | 14.81 | 20.16 | 18.32 | 25.16 | 25.98 | 21.93 | 17.89 | 14.15 | 16.10 | 16.66 | 18.40 | 38.37 | 39.58 | 42.23 | 23.28 | 23.12 | 21.85 | 19.42 |
Cash conversion cycle | days | 27.88 | 27.67 | 24.40 | 15.42 | 18.02 | 9.19 | 6.30 | 8.29 | 14.56 | 16.05 | 20.36 | 18.59 | 19.60 | 1.86 | 2.26 | -0.93 | 17.02 | 16.93 | 21.45 | 21.06 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 2.94 + 40.87 – 15.93
= 27.88
Lumen Technologies Inc's cash conversion cycle has shown variability over the past eight quarters. The company experienced negative cash conversion cycles in each quarter, indicating efficient management of its working capital. However, the magnitude of the negative cycles fluctuated, with the lowest being -14.21 days in Q4 2023 and the highest at -2.28 days in Q4 2022.
On average, the company's cash conversion cycle has improved compared to the previous year, reflecting enhanced efficiency in converting its investments in inventory and receivables into cash. The negative values suggest that Lumen Technologies is able to collect payments from customers and convert inventory into sales faster than it pays its suppliers, leading to a favorable cash flow position.
Overall, the trend of negative cash conversion cycles indicates that Lumen Technologies Inc has been successful in managing its working capital effectively, potentially freeing up cash for other strategic investments or operational needs.
Peer comparison
Dec 31, 2023