nVent Electric PLC (NVT)
Cash conversion cycle
| 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 | Dec 31, 2019 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 56.85 | 57.36 | 59.50 | 66.59 | 70.49 | 55.12 | 52.41 | 57.31 | 59.35 | 57.73 | 56.85 | 56.66 | 49.02 | 44.78 | 44.38 | 29.42 | 36.79 | 41.79 | 48.42 | 111.73 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | 33.93 | 34.23 | 37.17 | 34.86 | 35.79 | 36.26 | 38.11 | 39.62 | 44.25 | 43.71 | 46.09 | 42.77 | 39.00 | 33.30 | 32.28 | 17.13 | 20.05 | 25.33 | 37.02 | 60.20 |
| Cash conversion cycle | days | 22.91 | 23.13 | 22.33 | 31.72 | 34.70 | 18.86 | 14.30 | 17.69 | 15.10 | 14.02 | 10.76 | 13.89 | 10.02 | 11.48 | 12.09 | 12.29 | 16.74 | 16.46 | 11.40 | 51.53 |
June 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 56.85 + — – 33.93
= 22.91
The cash conversion cycle of nVent Electric PLC has shown some fluctuations over the past eight quarters. The cycle represents how long it takes for the company to convert its investments in inventory and other resources into cash inflows from sales.
Looking at the trend, we can see that the company's cash conversion cycle has been relatively stable from Mar 31, 2021, to Dec 31, 2023, ranging around 10 to 23 days. During this period, the company efficiently managed its operations to convert its investments into cash within a reasonable timeframe.
However, there was a notable increase in the cash conversion cycle in the Sep 30, 2019, quarter, reaching 51.53 days. This significant increase indicates that nVent Electric PLC faced challenges in efficiently managing its working capital and converting its investments into cash during that period.
Overall, the company has shown a generally efficient cash conversion cycle, with occasional fluctuations that may require attention to ensure optimal working capital management. Tracking and analyzing this metric can provide insights into the company's operational efficiency and financial health over time.
Peer comparison
Jun 30, 2024