Enpro Industries (NPO)

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 83.89 86.08 86.79 86.56 82.29 82.42 83.90 81.34 73.67 71.54 79.57 79.88 82.81 77.33 77.99 74.32 72.72 63.79 69.95 62.51
Days of sales outstanding (DSO) days
Number of days of payables days
Cash conversion cycle days 83.89 86.08 86.79 86.56 82.29 82.42 83.90 81.34 73.67 71.54 79.57 79.88 82.81 77.33 77.99 74.32 72.72 63.79 69.95 62.51

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 83.89 + — – —
= 83.89

The cash conversion cycle of Enpro Industries has shown some fluctuations over the years. The company's cash conversion cycle, which represents the time it takes for a company to convert its investments in inventory and other resources into cash receipts from sales, has varied between 62.51 days and 86.79 days during the period from March 31, 2020, to December 31, 2024.

It is observed that Enpro Industries experienced an increase in its cash conversion cycle from around 62.51 days on March 31, 2020, to a peak of 86.79 days on June 30, 2024, before showing a slight decrease by December 31, 2024. This trend may indicate inefficiencies in managing inventory, collecting receivables, or paying suppliers within a shorter time frame.

A higher cash conversion cycle suggests that the company takes longer to generate cash from its operating cycle, which could potentially strain liquidity and working capital management. Conversely, a lower cash conversion cycle indicates more efficient working capital management and quicker cash conversion.

Enpro Industries should closely monitor its cash conversion cycle and work towards optimizing it by streamlining its operations, improving inventory turnover, enhancing receivables collection processes, and negotiating better payment terms with suppliers. Efficient management of the cash conversion cycle is crucial for maintaining liquidity, managing working capital effectively, and supporting the company's overall financial health.