Lamb Weston Holdings Inc (LW)
Cash conversion cycle
| May 31, 2025 | Feb 28, 2025 | Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | May 26, 2024 | Feb 29, 2024 | Feb 25, 2024 | Nov 30, 2023 | Nov 26, 2023 | Aug 31, 2023 | Aug 27, 2023 | May 31, 2023 | May 28, 2023 | Feb 28, 2023 | Feb 26, 2023 | Nov 30, 2022 | Nov 27, 2022 | Aug 31, 2022 | Aug 28, 2022 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 74.80 | 92.25 | 92.56 | 83.49 | 84.67 | 84.11 | 88.65 | 86.72 | 81.03 | 80.12 | 59.69 | 63.37 | 72.82 | 80.02 | 81.60 | 81.68 | 80.59 | 80.50 | 62.01 | 64.03 |
| Days of sales outstanding (DSO) | days | 44.22 | 40.95 | 39.15 | 41.52 | 44.26 | 43.41 | 42.11 | 40.79 | 41.15 | 41.37 | 39.46 | 42.04 | 44.83 | 48.26 | 36.10 | 37.04 | 38.66 | 39.68 | 36.03 | 37.43 |
| Number of days of payables | days | 38.36 | 49.07 | 59.00 | 50.63 | 62.00 | 61.59 | 50.12 | 49.03 | 58.62 | 57.96 | 46.40 | 49.26 | 49.74 | 54.66 | 44.15 | 44.19 | 56.92 | 56.85 | 45.15 | 46.62 |
| Cash conversion cycle | days | 80.66 | 84.12 | 72.71 | 74.38 | 66.92 | 65.92 | 80.64 | 78.48 | 63.56 | 63.54 | 52.76 | 56.15 | 67.91 | 73.62 | 73.55 | 74.52 | 62.34 | 63.33 | 52.89 | 54.84 |
May 31, 2025 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 74.80 + 44.22 – 38.36
= 80.66
The cash conversion cycle (CCC) for Lamb Weston Holdings Inc exhibits notable fluctuations over the analyzed period, reflecting dynamic changes in the company's operational efficiency. Starting from August 28, 2022, with a CCC of approximately 54.84 days, the cycle showed a gradual increase, reaching peaks such as 74.52 days on February 26, 2023, and peaking further at 84.12 days on February 28, 2025.
During the initial period, the CCC fluctuated within a relatively narrow range of approximately 52.89 to 63.33 days, indicating a moderate level of operational efficiency in converting inventory and receivables into cash. Subsequently, the cycle experienced a significant upward trend, with notable increases around early 2023 and again in early 2024, suggesting either longer inventory holding periods, extended receivables collection durations, or a combination of both.
Particularly, the data indicates an upward trajectory beginning in late 2022, peaking at over 80 days in early 2025, which signals potential challenges in inventory management, receivables collection, or both. This extended cycle could imply increased working capital requirements, potential delays in inventory turnover, or slower receivables conversion into cash.
Overall, the trend indicates periods of operational inefficiency or strategic shifts that have led to longer durations in converting investment in inventory and receivables into cash inflows. Continuous monitoring of these components is essential for assessing the company's liquidity and working capital management strategies.
Peer comparison
May 31, 2025