Parker-Hannifin Corporation (PH)

Cash conversion cycle

		Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Days of inventory on hand (DOH)	days	82.67	79.64	84.20	70.44	73.07
Days of sales outstanding (DSO)	days	59.36	58.55	60.05	66.39	63.85
Number of days of payables	days	61.91	56.92	59.39	55.09	58.30
Cash conversion cycle	days	80.12	81.27	84.86	81.75	78.63

June 30, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 82.67 + 59.36 – 61.91
= 80.12

The cash conversion cycle (CCC) of Parker-Hannifin Corporation exhibits a trend of incremental fluctuation over the period from June 30, 2021, to June 30, 2025. Specifically, the CCC increased from 78.63 days in 2021 to 81.75 days in 2022, reflecting a slight elongation of the cycle by approximately 3.12 days. Subsequently, the cycle continued to lengthen, reaching 84.86 days in 2023, representing an increase of approximately 3.11 days relative to the prior year.

Following this upward trend, the CCC demonstrated signs of stabilization and marginal improvement from 2023 onward, decreasing to 81.27 days in 2024 and further to 80.12 days in 2025. This indicates a reduction of approximately 3.59 days over the final year, bringing the cycle closer to its 2021 levels.

Overall, the pattern shows a period of gradual elongation primarily between 2021 and 2023, suggestive of increasing operational or receivables and inventory management durations during this interval. The subsequent slight reduction in the cycle duration points to improved efficiency in inventory management, receivables collection, or payables management in the latter years. Variations in the CCC may reflect changes in the company's operational processes, supply chain dynamics, or credit policies. The cyclical behavior and the overall modest variation suggest a relatively stable working capital management environment, with the recent trend indicating a possible move towards enhanced operational efficiency.