Marathon Petroleum Corp (MPC)

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	25.78	27.86	25.47	25.13	20.81	23.41	27.99	27.25	26.01	34.24	37.65	42.17	35.36	28.80	28.42	22.67	31.10	30.83	30.85	37.05
Days of sales outstanding (DSO)	days	37.86	30.46	24.12	21.41	27.90	28.23	39.65	42.36	33.72	34.01	41.00	37.64	28.02	20.33	15.59	16.87	23.18	21.75	23.69	23.76
Number of days of payables	days	38.08	43.51	34.86	31.89	36.09	39.70	57.00	56.88	44.25	45.33	51.60	49.92	34.49	26.07	21.48	24.68	35.60	36.19	37.01	39.82
Cash conversion cycle	days	25.56	14.82	14.73	14.64	12.61	11.93	10.63	12.73	15.49	22.92	27.04	29.89	28.88	23.06	22.54	14.86	18.68	16.40	17.52	20.99

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 25.78 + 37.86 – 38.08
= 25.56

The cash conversion cycle of Marathon Petroleum Corp has seen slight fluctuations over the past eight quarters, ranging from a low of 9.77 days in Q2 2022 to a high of 15.78 days in Q4 2023. Generally, the company takes around two weeks to convert its investments in inventory into cash receipts from customers, reflecting the time it takes for Marathon Petroleum Corp to sell its products, collect receivables, and pay suppliers. The variations in the cash conversion cycle might be influenced by changes in inventory levels, sales patterns, and credit terms with customers and suppliers. In the most recent quarters, there is a trend of increasing days in the cash conversion cycle, indicating that Marathon Petroleum Corp may be experiencing some challenges in efficiently managing its working capital and cash flow. Further analysis and monitoring of the cash conversion cycle will be crucial to identify areas for improvement and ensure optimal financial performance.