Omnicom Group Inc (OMC)

Cash conversion cycle

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Days of inventory on hand (DOH) days 38.35 37.52 36.25 33.91 35.77
Days of sales outstanding (DSO) days 215.14 206.83 216.42 216.53 191.10
Number of days of payables days 332.30 328.95 359.13 354.50 334.76
Cash conversion cycle days -78.81 -84.60 -106.46 -104.06 -107.89

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 38.35 + 215.14 – 332.30
= -78.81

Omnicom Group, Inc.'s cash conversion cycle has exhibited some fluctuation over the past five years. The company's cash conversion cycle was 215.14 days at the end of December 2023, showing a slight increase compared to the previous year. This indicates that it takes Omnicom Group approximately 215.14 days to convert its investments in inventory and accounts receivable into cash.

Comparing this figure to the trend over the preceding years, we observe that the cash conversion cycle was relatively stable around the 200 to 220-day range, except for a notable dip to 191.10 days at the end of December 2019. This improvement in the cash conversion cycle in 2019 suggests that Omnicom Group managed its inventory and receivables more efficiently during that period.

Overall, Omnicom Group's cash conversion cycle over the past five years reflects moderate efficiency in managing its working capital and liquidity. Further analysis and comparison with industry benchmarks could provide additional insights into the company's operational and financial performance.


Peer comparison

Dec 31, 2023

Company name
Symbol
Cash conversion cycle
Omnicom Group Inc
OMC
-78.81
Interpublic Group of Companies Inc
IPG
142.09