MillerKnoll Inc (MLKN)

Cash conversion cycle

		Aug 31, 2024	Mar 2, 2024	Dec 2, 2023	Sep 2, 2023	Jun 3, 2023	Mar 4, 2023	Dec 3, 2022	Sep 3, 2022	May 28, 2022	Feb 26, 2022	Nov 27, 2021	Aug 28, 2021	May 29, 2021	Feb 27, 2021	Nov 28, 2020	Aug 29, 2020	May 30, 2020	Feb 29, 2020	Nov 30, 2019	Aug 31, 2019
Days of inventory on hand (DOH)	days	46.18	43.78	43.30	44.10	45.16	49.28	53.15	55.87	55.90	55.88	59.87	65.48	38.21	42.78	38.86	36.82	37.41	30.59	28.66	28.31
Days of sales outstanding (DSO)	days	32.92	15.10	16.10	14.86	16.38	—	—	—	35.58	37.89	43.10	43.15	32.88	34.75	34.60	33.56	29.39	35.45	33.96	35.25
Number of days of payables	days	24.75	24.22	24.22	23.49	24.97	25.82	25.49	27.52	33.80	36.57	41.36	48.04	29.82	33.93	33.45	31.49	24.42	27.55	25.91	27.89
Cash conversion cycle	days	54.35	34.65	35.18	35.48	36.57	23.46	27.66	28.35	57.68	57.20	61.61	60.58	41.27	43.61	40.01	38.89	42.38	38.49	36.71	35.67

August 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 46.18 + 32.92 – 24.75
= 54.35

The cash conversion cycle of MillerKnoll Inc has shown some fluctuations over the past several periods. Generally, the company takes around 30 to 60 days to convert its investments in inventory into cash receipts from customers. A lower cash conversion cycle indicates that the company is efficient in managing its working capital.

In the latest period, the cash conversion cycle was 54.35 days, which increased from the previous period's 34.65 days. This increase suggests that MillerKnoll Inc took longer to convert its investments in inventory into cash receipts, possibly indicating inefficiencies in managing the working capital cycle.

Looking back over the historical data, there are periods where the cash conversion cycle has been relatively stable around the 30 to 40-day range, such as in March 2023 and February 2021. Conversely, there are periods where the cycle was longer, exceeding 50 days, like in August 2024 and May 2022.

Overall, a consistent monitoring and management of the cash conversion cycle is essential for MillerKnoll Inc to ensure efficient operations and optimal cash flow management. fluctuations in this cycle could indicate potential issues in inventory management, accounts receivable collection, or accounts payable extension, which may require further investigation and corrective actions.