LyondellBasell Industries NV (LYB)

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	48.52	49.43	49.67	45.28	39.99	41.41	41.86	44.48	47.83	54.81	61.02	67.17	65.09	59.20	52.74	50.49	57.15	54.12	54.78	51.34
Days of sales outstanding (DSO)	days	4.23	—	32.34	29.95	29.52	29.77	36.87	39.16	41.20	46.43	50.55	49.27	59.04	38.78	31.55	33.21	36.31	35.74	37.22	35.33
Number of days of payables	days	—	—	28.91	26.59	25.86	28.19	33.69	37.86	33.77	38.44	36.68	39.20	35.93	29.76	25.06	28.17	31.34	32.71	30.21	29.80
Cash conversion cycle	days	52.74	49.43	53.10	48.64	43.66	42.99	45.03	45.78	55.27	62.80	74.90	77.25	88.20	68.22	59.24	55.53	62.12	57.16	61.78	56.87

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 48.52 + 4.23 – —
= 52.74

The cash conversion cycle of LyondellBasell Industries NV has been relatively consistent over the past eight quarters, ranging between 37.99 days and 48.39 days. This metric represents the average number of days it takes for the company to convert its raw materials into finished products to sell, collect payments from customers, and pay its suppliers.

A longer cash conversion cycle indicates that the company takes more time to generate cash from its operations, potentially tying up capital in the production process or in accounts receivable. On the other hand, a shorter cycle implies more efficient cash flow management.

In the most recent quarter, Q4 2023, the cash conversion cycle was 45.09 days, which is slightly higher than the cycle in Q3 2023 (47.33 days) and Q2 2023 (48.39 days), but lower than Q1 2023 (43.87 days). This suggests that the company may have experienced a slight delay in converting its working capital into cash in the short term.

Overall, it is important for LyondellBasell Industries NV to continually monitor and manage its cash conversion cycle to ensure optimal efficiency in its operations and cash flow management.