nVent Electric PLC (NVT)
Cash conversion cycle
| 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 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 47.58 | 56.85 | 57.36 | 48.56 | 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 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | 31.62 | 33.93 | 34.23 | 32.33 | 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 |
| Cash conversion cycle | days | 15.95 | 22.91 | 23.13 | 16.23 | 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 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 47.58 + — – 31.62
= 15.95
The cash conversion cycle of nVent Electric PLC has shown fluctuations over the past few quarters. The trend indicates that the company's ability to convert its investments in inventory and accounts receivable back into cash has varied over time.
In the most recent quarter, ending September 30, 2024, the cash conversion cycle was 15.95 days, showing an improvement from the previous quarter's 22.91 days. This suggests that nVent Electric PLC was more efficient in managing its working capital and converting its resources into cash during this period.
Looking back at historical data, the company experienced a peak cash conversion cycle of 34.70 days in the quarter ending June 30, 2023, followed by a significant improvement to 18.86 days in the subsequent quarter. This highlights the volatility in nVent Electric PLC's cash conversion cycle and the importance of effective working capital management.
Overall, fluctuations in the cash conversion cycle can be influenced by various factors such as inventory management, accounts receivable collection efficiency, and payment terms with suppliers. nVent Electric PLC should continue to monitor and manage its cash conversion cycle to ensure optimal working capital performance and financial stability.
Peer comparison
Sep 30, 2024