Medtronic PLC (MDT)

Cash conversion cycle

		Apr 30, 2025	Jan 31, 2025	Oct 31, 2024	Jul 31, 2024	Apr 30, 2024	Apr 26, 2024	Jan 31, 2024	Jan 26, 2024	Oct 31, 2023	Oct 27, 2023	Jul 31, 2023	Jul 28, 2023	Apr 30, 2023	Apr 28, 2023	Jan 31, 2023	Jan 27, 2023	Oct 31, 2022	Oct 28, 2022	Jul 31, 2022	Jul 29, 2022
Days of inventory on hand (DOH)	days	223.87	166.21	122.95	122.72	101.14	104.64	119.87	120.94	122.73	121.18	117.20	116.80	108.59	111.37	117.93	116.31	111.02	108.00	97.83	100.41
Days of sales outstanding (DSO)	days	70.91	67.23	66.02	63.97	65.24	66.42	68.55	69.39	69.72	68.49	63.79	63.74	65.86	67.82	70.88	71.72	69.57	68.40	63.51	62.70
Number of days of payables	days	100.12	67.73	53.32	51.93	46.72	48.34	41.70	42.07	46.37	45.79	46.30	46.14	54.61	56.01	48.47	47.80	48.27	46.96	44.35	45.52
Cash conversion cycle	days	194.66	165.71	135.65	134.77	119.66	122.72	146.72	148.26	146.08	143.88	134.70	134.40	119.84	123.18	140.34	140.24	132.32	129.44	116.99	117.60

April 30, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 223.87 + 70.91 – 100.12
= 194.66

The cash conversion cycle of Medtronic PLC, a measure of how quickly a company can convert its investments in inventory and other resources into cash flows from sales, has shown some fluctuations over the periods provided.

The cycle started around 117-120 days in July and October 2022, indicating that Medtronic took approximately 4 months to convert its investments back into cash. There was a slight increase in the cycle to around 140 days in January 2023, suggesting a slower turnover of cash within the business.

Subsequently, the cycle improved to around 120-130 days in April and July 2023, before peaking at 146 days in October 2023 and January 2024. This increase may indicate potential inefficiencies in managing inventory, accounts receivable, and accounts payable during these periods.

However, there was a significant improvement in the cycle to below 120 days in April 2024, signaling more efficient cash management practices. The cycle remained relatively stable around 120-135 days from July 2024 to April 2025, except for a notable increase to 165-195 days in January and April 2025. This rise could imply challenges in managing working capital effectively or delays in converting resources into cash.

Overall, fluctuations in the cash conversion cycle of Medtronic PLC suggest varying levels of efficiency in managing cash flows and working capital over the analyzed periods. Further monitoring and analysis may be necessary to identify underlying factors contributing to these fluctuations and to optimize the company's cash conversion cycle.