Philip Morris International Inc (PM)
Cash conversion cycle
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 228.85 | 230.42 | 234.42 | 239.68 | 264.05 | 247.20 | 257.72 | 305.34 | 290.13 | 208.28 | 225.76 | 266.87 | 274.21 | 265.81 | 287.33 | 301.16 | 318.19 | 257.60 | 278.18 | 270.61 |
| Days of sales outstanding (DSO) | days | 45.78 | 52.14 | 52.89 | 53.43 | 29.68 | 23.50 | 19.18 | 16.75 | 17.23 | 17.30 | 17.40 | 16.03 | 13.99 | 18.95 | 20.76 | 19.47 | 17.27 | 18.72 | 19.55 | 15.44 |
| Number of days of payables | days | 95.67 | 86.48 | 89.73 | 87.70 | 101.54 | 90.55 | 98.56 | 112.45 | 119.62 | 97.31 | 98.04 | 98.43 | 104.75 | 91.39 | 86.96 | 84.71 | 92.23 | 68.03 | 61.76 | 62.02 |
| Cash conversion cycle | days | 178.95 | 196.08 | 197.59 | 205.41 | 192.19 | 180.16 | 178.35 | 209.64 | 187.74 | 128.27 | 145.13 | 184.47 | 183.46 | 193.36 | 221.13 | 235.91 | 243.24 | 208.29 | 235.97 | 224.03 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 228.85 + 45.78 – 95.67
= 178.95
The cash conversion cycle of Philip Morris International Inc has shown fluctuations over the periods analyzed. The trend indicates that the company has made improvements in managing its working capital efficiency.
The cash conversion cycle, which measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales, decreased from 224.03 days as of March 31, 2020, to 178.95 days as of December 31, 2024.
The company managed to significantly reduce its cash conversion cycle by approximately 39 days over this period. This improvement suggests that Philip Morris International Inc has been able to streamline its operations, manage its inventory more effectively, and collect receivables more efficiently.
The downward trend in the cash conversion cycle indicates that the company has been able to operate with better liquidity and generate cash flows at a faster rate relative to its investments in working capital. This efficient management of working capital is indicative of effective operational management and financial discipline within the organization.
Overall, the decreasing trend in the cash conversion cycle is a positive signal for investors and indicates that Philip Morris International Inc has been successful in optimizing its working capital management, potentially leading to improved financial performance and profitability.
Peer comparison
Dec 31, 2024
See also:
Philip Morris International Inc Cash Conversion Cycle (Quarterly Data)