MSA Safety (MSA)

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	78.99	88.27	94.70	100.95	100.96	105.97	104.41	99.58	88.42	87.21	91.44	97.63	118.78	125.56	108.67	92.38	88.24	92.75	91.77	84.74
Days of sales outstanding (DSO)	days	62.80	69.28	72.86	70.06	80.27	71.40	75.84	71.46	74.04	72.29	74.45	74.17	75.39	69.69	69.77	73.28	69.81	72.11	74.76	74.47
Number of days of payables	days	30.20	29.57	29.99	30.69	33.58	31.81	34.20	33.57	33.65	32.39	35.01	40.25	42.12	39.61	46.53	42.05	42.50	33.67	35.81	37.06
Cash conversion cycle	days	111.59	127.98	137.57	140.33	147.65	145.55	146.06	137.47	128.82	127.12	130.88	131.55	152.06	155.63	131.91	123.61	115.55	131.19	130.73	122.14

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 78.99 + 62.80 – 30.20
= 111.59

The cash conversion cycle of MSA Safety Inc has shown some fluctuations over the past eight quarters. In Q4 2023, the company's cash conversion cycle improved to 133.32 days, indicating that it took MSA Safety Inc 133.32 days to convert its investments in raw materials into cash from sales. This represents a positive trend compared to the previous quarter where the cash conversion cycle was higher at 153.31 days, showing efficiency in managing its working capital.

However, looking back over the past year, there have been some fluctuations in the cash conversion cycle, with the highest being in Q4 2022 at 172.62 days. This suggests that MSA Safety Inc took longer to convert its investments into cash during that period. On the other hand, the lowest cash conversion cycle was in Q1 2022 at 166.28 days, indicating better efficiency in working capital management.

Overall, MSA Safety Inc should aim to maintain a lower cash conversion cycle to improve its liquidity and operational efficiency. Keeping a close eye on working capital management and optimizing the cash conversion cycle can help the company enhance its financial performance and meet its short-term obligations more effectively.