Altria Group (MO)
Cash conversion cycle
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 64.87 | 43.48 | 66.86 | 61.22 | 91.79 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 64.87 | 43.48 | 66.86 | 61.22 | 91.79 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 64.87 + — – —
= 64.87
The cash conversion cycle for Altria Group has exhibited fluctuations over the five-year period from December 31, 2020, to December 31, 2024. In 2020, the company had a cash conversion cycle of 91.79 days, indicating that it took approximately three months for Altria to convert its investments in inventory and accounts receivable into cash receipts from customers.
By December 31, 2021, the cash conversion cycle decreased to 61.22 days, suggesting an improvement in the company's efficiency in managing its working capital. This trend continued into 2022, with a slight increase to 66.86 days, still showing a relatively efficient conversion of assets into cash.
In the following year, by December 31, 2023, Altria Group significantly reduced its cash conversion cycle to 43.48 days, indicating a notable enhancement in the company's working capital management. This improvement can signify better inventory turnover and quicker conversion of receivables into cash.
However, by December 31, 2024, the cash conversion cycle increased to 64.87 days, reversing the positive trend observed in the previous year. This might indicate a potential slowdown in the company's ability to efficiently convert its assets into cash or could be reflective of changes in inventory levels or customer payment behaviors.
Overall, analyzing the cash conversion cycle for Altria Group provides insights into the company's operational efficiency and effectiveness in managing working capital. Tracking this metric over time can help assess the company's ability to optimize its resources and generate cash flows from its core operations.
Peer comparison
Dec 31, 2024