Pitney Bowes Inc (PBI)

Cash conversion cycle

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Days of inventory on hand (DOH) days 24.25 105.06 12.43 11.45 11.07
Days of sales outstanding (DSO) days
Number of days of payables days
Cash conversion cycle days 24.25 105.06 12.43 11.45 11.07

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 24.25 + — – —
= 24.25

The cash conversion cycle of Pitney Bowes Inc has shown a fluctuating trend over the years based on the provided data. As of December 31, 2020, the company's cash conversion cycle stood at 11.07 days, indicating a relatively efficient management of cash flows from operations to sales and back to cash.

However, by December 31, 2021, the cash conversion cycle slightly increased to 11.45 days, showing a longer period to convert sales into cash. This trend continued into December 31, 2022, with the cycle extending to 12.43 days, suggesting potential challenges in managing working capital effectively.

By December 31, 2023, there was a significant spike in the cash conversion cycle to 105.06 days, indicating a substantial delay in the conversion of sales into cash. This prolonged cycle may raise concerns about liquidity and operational efficiency within the company.

Fortunately, by December 31, 2024, the cash conversion cycle improved to 24.25 days, although still higher compared to previous years, signaling efforts to streamline operations and enhance cash management processes within the organization. Overall, Pitney Bowes Inc should focus on optimizing its cash conversion cycle to maintain healthy liquidity and operational efficiency in the long term.