Paylocity Holdng (PCTY)
Cash conversion cycle
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | 2,684.52 | 5.67 | 2,921.39 | 2,592.46 |
| Days of sales outstanding (DSO) | days | 10.43 | 9.15 | 6.74 | 3.60 | 3.20 |
| Number of days of payables | days | 7.14 | 6.12 | 10.65 | 7.04 | 3.52 |
| Cash conversion cycle | days | 3.29 | 2,687.55 | 1.76 | 2,917.95 | 2,592.14 |
June 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 10.43 – 7.14
= 3.29
The cash conversion cycle of Paylocity Holdng has displayed significant fluctuations over the past five years. In Jun 30, 2024, the cash conversion cycle improved sharply to 3.29 days, compared to the previous year's unusually high level of 2,687.55 days. This indicates a positive trend in efficiently managing cash flow and working capital.
In Jun 30, 2023, the cash conversion cycle had a significant deterioration to 2,687.55 days, which was likely due to challenges in managing receivables, inventory, and payables effectively. This resulted in a prolonged cash conversion cycle, indicating potential issues with liquidity and operational efficiency.
Jun 30, 2022, witnessed an improvement in the cash conversion cycle to 1.76 days, reflecting better management of cash flow and working capital. However, in Jun 30, 2021, the cash conversion cycle worsened dramatically to 2,917.95 days, indicating difficulties in converting sales into cash and managing operating capital efficiently.
In Jun 30, 2020, the cash conversion cycle stood at 2,592.14 days, suggesting ongoing challenges in optimizing cash flow processes and working capital management. Overall, Paylocity Holdng's cash conversion cycle has experienced significant fluctuations, with some years showing improvement in efficiency while others highlighted potential weaknesses in managing cash flow and working capital effectively.
Peer comparison
Jun 30, 2024