Martin Marietta Materials Inc (MLM)
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 | 87.35 | 85.65 | 86.39 | 83.96 | 75.89 | 76.28 | 73.24 | 73.46 | 67.32 | 63.08 | 66.91 | 65.91 | 67.57 | 69.46 | 74.51 | 72.60 | 74.43 | 75.27 | 73.35 | 71.42 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 87.35 | 85.65 | 86.39 | 83.96 | 75.89 | 76.28 | 73.24 | 73.46 | 67.32 | 63.08 | 66.91 | 65.91 | 67.57 | 69.46 | 74.51 | 72.60 | 74.43 | 75.27 | 73.35 | 71.42 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 87.35 + — – —
= 87.35
The cash conversion cycle of Martin Marietta Materials Inc has shown fluctuations over the period under analysis. From March 31, 2020 to December 31, 2024, there has been a general trend of increasing the number of days in the cash conversion cycle, reflecting a longer time span required to convert investments in inventory and accounts receivable into cash.
The cycle ranged from a low of 65.91 days on March 31, 2022, to a high of 87.35 days on December 31, 2024. A shortening of the cycle could indicate more efficient management of working capital, while a lengthening cycle might point at liquidity challenges or operational inefficiencies.
It is worth noting that the company experienced a peak in the cash conversion cycle between June 30, 2024, and December 31, 2024, with values exceeding 85 days. This suggests potential challenges in managing inventories and collecting receivables efficiently during this period.
Overall, monitoring the cash conversion cycle is crucial for evaluating the effectiveness of Martin Marietta Materials Inc in managing its operational liquidity and working capital efficiently. Any sustained increase in the cycle duration should be further investigated to understand the underlying reasons and potential implications for the company's financial health.
Peer comparison
Dec 31, 2024