Philip Morris International Inc (PM)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 258.60 | 291.05 | 261.61 | 306.19 | 265.04 |
| Days of sales outstanding (DSO) | days | 47.41 | 17.23 | 13.99 | 14.04 | 14.01 |
| Number of days of payables | days | 99.44 | 120.00 | 99.94 | 88.75 | 65.98 |
| Cash conversion cycle | days | 206.56 | 188.28 | 175.67 | 231.48 | 213.06 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 258.60 + 47.41 – 99.44
= 206.56
The cash conversion cycle of Philip Morris International Inc has shown some fluctuation over the past five years. In 2023, the company's cash conversion cycle improved to 233.29 days, indicating that it took the company approximately 233 days to convert its investments in inventory and other resources into cash from sales. This was a decrease from the previous year's figure of 240.64 days, suggesting more efficient management of working capital.
In comparison to 2021 and 2020, where the cash conversion cycle was 241.90 days and 307.64 days respectively, the company has been able to streamline its cash conversion process. However, it is worth noting that in 2019, the cash conversion cycle was lower at 286.33 days compared to 2023, indicating that the company's efficiency in converting investments into cash was better in that year.
Overall, the trend in Philip Morris International Inc's cash conversion cycle over the past five years suggests a focus on optimizing working capital management and improving operational efficiency, leading to a shorter cash conversion cycle in recent years.
Peer comparison
Dec 31, 2023