Planet Fitness Inc (PLNT)
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 | 8.98 | 13.33 | 12.44 | 10.47 | 10.85 | 5.00 | 3.87 | 2.34 | 1.63 | 7.43 | 2.31 | 0.95 | 0.89 | 6.28 | 7.46 | 5.66 | 1.65 | 4.82 | 4.87 | 7.37 |
| Days of sales outstanding (DSO) | days | 20.83 | 18.79 | 23.22 | 12.28 | 28.55 | 25.79 | 25.84 | 22.73 | 31.79 | 19.46 | 27.51 | 27.89 | 40.78 | 38.37 | 28.25 | 18.20 | 29.47 | 22.30 | 23.98 | 18.32 |
| Number of days of payables | days | 45.69 | 50.18 | 53.47 | 35.54 | 42.39 | 26.31 | 28.40 | 32.32 | 39.41 | 39.35 | 34.90 | 29.61 | 36.60 | 68.77 | 30.78 | 75.57 | 39.92 | 42.55 | 31.55 | 49.33 |
| Cash conversion cycle | days | -15.88 | -18.06 | -17.81 | -12.79 | -2.99 | 4.48 | 1.31 | -7.25 | -5.98 | -12.45 | -5.09 | -0.76 | 5.08 | -24.12 | 4.93 | -51.70 | -8.81 | -15.43 | -2.70 | -23.64 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 8.98 + 20.83 – 45.69
= -15.88
The cash conversion cycle of Planet Fitness Inc has shown fluctuations over the past eight quarters. In Q4 2023, the company's cash conversion cycle was -17.54 days, indicating that Planet Fitness was able to convert its inventory and accounts receivable into cash more quickly than in the previous quarters. This suggests an improvement in the efficiency of the company's working capital management.
Compared to Q3 2023 and Q2 2023, where the cash conversion cycle was -19.51 days and -19.64 days respectively, the company further reduced the days needed to convert its resources into cash in Q4 2023.
However, in Q1 2023, the cash conversion cycle was -13.81 days, showing a slight increase compared to Q4 2023, but still indicating efficient management of working capital. In Q4 2022, the cash conversion cycle was -5.56 days, significantly lower than in the recent quarters, suggesting that the company had a very fast conversion of resources into cash at that time.
It is worth noting that in Q2 2022 and Q1 2022, the cash conversion cycle was notably higher at -31.34 days and -50.92 days respectively, indicating that the conversion of inventory and receivables into cash took longer during those periods.
Overall, Planet Fitness Inc has shown variability in its cash conversion cycle over the past eight quarters, with some quarters demonstrating more efficient working capital management compared to others.