Pitney Bowes Inc (PBI)
Cash conversion cycle
| 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 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 23.30 | 26.29 | 29.40 | 33.60 | 29.87 | 22.66 | 16.47 | 14.48 | 11.24 | 9.88 | 9.58 | 9.19 | 10.85 | 11.13 | 13.08 | 13.39 | 12.96 | 14.64 | 14.43 | 13.86 |
| Days of sales outstanding (DSO) | days | 101.28 | 93.38 | 91.95 | 89.21 | 94.63 | 87.55 | 84.04 | 86.69 | 90.34 | 88.65 | 87.90 | 91.73 | 100.70 | 106.47 | 113.23 | 117.02 | 125.23 | 125.42 | 139.79 | 128.18 |
| Number of days of payables | days | 93.94 | — | — | — | 112.53 | — | — | — | 44.49 | — | — | — | 44.80 | — | — | — | 53.57 | — | — | — |
| Cash conversion cycle | days | 30.64 | 119.67 | 121.35 | 122.82 | 11.98 | 110.21 | 100.51 | 101.18 | 57.09 | 98.53 | 97.48 | 100.92 | 66.74 | 117.60 | 126.31 | 130.42 | 84.62 | 140.06 | 154.22 | 142.05 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 23.30 + 101.28 – 93.94
= 30.64
The cash conversion cycle of Pitney Bowes, Inc. has shown fluctuations over the past eight quarters. A higher cash conversion cycle indicates a longer period for the company to convert its investments in inventory and accounts receivable into cash.
In Q4 2023, the cash conversion cycle was at 65.67 days, showing an improvement from the previous quarter. This suggests that the company managed its inventory and accounts receivable more efficiently in this period.
Q3 and Q2 2023 saw significantly higher cash conversion cycles at 106.46 days and 105.71 days, respectively. This indicates a longer cash cycle, possibly due to slower inventory turnover or delays in collecting accounts receivable.
Q1 2023 also showed a longer cash conversion cycle at 101.82 days. This suggests that the company faced challenges in converting investments into cash during this period.
Compared to the same quarter in the previous year, Q4 2022 had a lower cash conversion cycle at 58.59 days, indicating better management of working capital.
Q3 and Q2 2022 had higher cash conversion cycles at 97.99 days and 94.50 days, respectively, indicating inefficiencies in managing working capital during those quarters.
Overall, Pitney Bowes, Inc. should focus on improving its inventory turnover and accounts receivable collection process to shorten its cash conversion cycle and optimize its working capital management.