Altria Group (MO)
Cash conversion cycle
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 43.48 | 68.68 | 66.97 | 73.46 | 69.67 | 64.38 | 65.10 | 65.72 | 62.35 | 33.96 | 52.25 | 63.92 | 65.59 | 70.41 | 85.71 | 88.63 | 113.89 | 100.19 | 100.95 | 108.07 |
| Days of sales outstanding (DSO) | days | 1.10 | 0.88 | 0.96 | 0.89 | 0.73 | 0.79 | 0.64 | 0.68 | 0.71 | 0.54 | 1.94 | 2.14 | 1.98 | 2.21 | 2.07 | 2.15 | 2.30 | 2.49 | 2.44 | 2.39 |
| Number of days of payables | days | 20.83 | 28.67 | 25.53 | 24.17 | 32.59 | 24.28 | 22.54 | 20.52 | 23.45 | 7.97 | 7.57 | 8.89 | 12.68 | 13.16 | 12.22 | 12.28 | 16.14 | 11.26 | 10.12 | 9.40 |
| Cash conversion cycle | days | 23.75 | 40.90 | 42.40 | 50.17 | 37.81 | 40.90 | 43.21 | 45.88 | 39.61 | 26.52 | 46.62 | 57.17 | 54.89 | 59.46 | 75.55 | 78.50 | 100.04 | 91.41 | 93.28 | 101.06 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 43.48 + 1.10 – 20.83
= 23.75
The cash conversion cycle measures the time it takes for a company like Altria Group Inc. to convert its investments in inventory and other resources into cash flows from sales to customers. A shorter cycle indicates efficient management of working capital, as it reflects the company's ability to quickly convert its investments into cash.
In the case of Altria Group Inc., the trend in the cash conversion cycle over the past eight quarters shows some fluctuations. In Q1 2022, the company had a cash conversion cycle of 44.46 days, which then decreased to 40.87 days in Q2 2022 and further decreased to 38.63 days in Q3 2022. However, in Q4 2022, there was a slight increase to 61.31 days before dropping again to 74.10 days in Q1 2023. Subsequently, the cycle decreased to 68.92 days in Q2 2023, followed by a further decrease to 40.69 days in Q3 2023, and finally, a slight increase to 38.22 days in Q4 2023.
Overall, Altria Group Inc. experienced fluctuations in its cash conversion cycle over the past eight quarters, with some periods of improvement and some periods of deterioration. It is essential for the company to closely monitor and manage its working capital to ensure efficient operations and maximize cash flows from its investments.
Peer comparison
Dec 31, 2023