LyondellBasell Industries NV (LYB)

Cash conversion cycle

		Dec 31, 2024	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	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Days of inventory on hand (DOH)	days	47.37	53.22	51.18	49.39	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
Days of sales outstanding (DSO)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Number of days of payables	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Cash conversion cycle	days	47.37	53.22	51.18	49.39	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

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 47.37 + — – —
= 47.37

The cash conversion cycle (CCC) of LyondellBasell Industries NV has shown fluctuating trends over the past few years based on the provided data. The CCC is a measure of how long it takes for a company to convert its investments in inventory and other resources into cash inflows from sales.

From March 31, 2020, to June 30, 2021, the CCC increased steadily, reaching a peak of 67.17 days. This increase could indicate inefficiencies in managing inventory, collecting receivables, or paying payables. However, from June 30, 2021, to December 31, 2024, the CCC showed a general downward trend, indicating improvements in the company's efficiency in managing its working capital.

The decrease in the CCC could be attributed to better inventory management, faster collection of receivables, and extended payment terms to suppliers. A lower CCC means the company is able to free up cash quickly, which can be reinvested in the business, reducing financing costs, and potentially improving profitability.

Overall, monitoring the CCC is crucial for assessing a company's operational efficiency and liquidity management. LyondellBasell's decreasing CCC trend from June 30, 2021, to December 31, 2024, suggests the company's efforts to streamline its working capital processes and enhance cash flow management, which can positively impact its financial performance and sustainability.