Post Holdings Inc (POST)
Cash conversion cycle
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 49.00 | 56.43 | 45.72 | 48.97 | 67.08 |
| Days of sales outstanding (DSO) | days | 26.85 | 26.75 | 33.95 | 33.15 | 34.21 |
| Number of days of payables | days | 31.43 | 26.35 | 37.69 | 39.47 | 41.17 |
| Cash conversion cycle | days | 44.42 | 56.84 | 41.97 | 42.65 | 60.12 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 49.00 + 26.85 – 31.43
= 44.42
The cash conversion cycle for Post Holdings Inc has varied over the past five years, with fluctuations observed in the time it takes for the company to convert its investments in inventory and accounts receivable into cash receipts from customers.
In 2024, the cash conversion cycle improved to 44.42 days, indicating the company was able to manage its working capital more efficiently compared to the previous year. This reduction in the cash conversion cycle could be attributed to better inventory management and faster collection of accounts receivable.
In 2023 and 2021, the cash conversion cycle was relatively steady at 56.84 days and 42.65 days respectively. This suggests that the company's working capital management was consistent during those periods, with stable inventory turnover and accounts receivable collection practices.
The company experienced a notably low cash conversion cycle in 2022 at 41.97 days, indicating more efficient working capital management and quicker cash conversion compared to surrounding years.
Conversely, in 2020, the cash conversion cycle increased significantly to 60.12 days, indicating potential challenges in converting investments in inventory and accounts receivable into cash receipts efficiently. This prolonged cash conversion cycle may have resulted from slower inventory turnover or delayed collections from customers during that year.
Overall, the fluctuating trends in the cash conversion cycle over the past five years suggest that Post Holdings Inc has experienced varying degrees of efficiency in managing its working capital, with potential areas for improvement identified in certain years.
Peer comparison
Sep 30, 2024