Plexus Corp (PLXS)

Cash conversion cycle

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Days of inventory on hand (DOH)	days	141.78	160.73	110.94	85.89	84.65
Days of sales outstanding (DSO)	days	28.42	34.87	27.76	25.59	27.64
Number of days of payables	days	58.69	80.79	72.45	58.08	53.73
Cash conversion cycle	days	111.51	114.81	66.25	53.40	58.55

September 30, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 141.78 + 28.42 – 58.69
= 111.51

The cash conversion cycle of Plexus Corp. has fluctuated over the past five years. In September 2023, the company's cash conversion cycle was 144.92 days, indicating that it takes approximately 145 days for the company to convert its investments in inventory and other resources into cash flows from sales. This is a slight improvement from the previous year, where the cycle was 154.64 days.

However, compared to the data from October 2, 2021, the cash conversion cycle has lengthened, increasing from 96.73 days to 144.92 days. This implies that the company is taking longer to convert its investments into cash, which may have implications for its liquidity and working capital management.

In contrast, in 2020, the cash conversion cycle was 81.21 days, demonstrating a significant increase compared to the 2019 figure of 88.85 days. This suggests that the company's efficiency in managing its working capital and converting its resources into cash has deteriorated over the past two years.

Overall, the trend in Plexus Corp.'s cash conversion cycle indicates potential challenges in efficiently managing working capital and converting investments into cash. Analyzing the drivers behind these changes may provide insights into the company's operational and financial performance.