Matthews International Corporation (MATW)
Cash conversion cycle
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 68.58 | 72.93 | 66.35 | 61.12 | 63.88 |
| Days of sales outstanding (DSO) | days | 41.87 | 40.27 | 45.77 | 67.67 | 71.91 |
| Number of days of payables | days | 31.24 | 32.02 | 35.72 | 36.44 | 30.25 |
| Cash conversion cycle | days | 79.21 | 81.19 | 76.41 | 92.36 | 105.54 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 68.58 + 41.87 – 31.24
= 79.21
The cash conversion cycle of Matthews International Corporation has fluctuated over the years, indicating varying efficiency in managing its cash flow. In the most recent fiscal year ending on September 30, 2024, the company's cash conversion cycle was 79.21 days, showing an improvement compared to the previous year's cycle of 81.19 days. This suggests that the company was able to convert its investment in raw materials into cash at a faster rate in 2024.
However, when compared to fiscal year 2022, where the cash conversion cycle was shorter at 76.41 days, there was a slight increase in the number of days it took for Matthews International Corporation to convert its investments in inventory and accounts receivable into cash in 2024.
Furthermore, looking back at fiscal year 2021 and 2020, the company experienced longer cash conversion cycles of 92.36 days and 105.54 days, respectively. This indicates potential issues with managing working capital efficiency in those years.
Overall, the trend in Matthews International Corporation's cash conversion cycle shows fluctuations, with improvements in some years and challenges in others. It is essential for the company to continue monitoring and optimizing its working capital management to enhance its cash flow efficiency and overall financial performance.