Royal Caribbean Cruises Ltd (RCL)

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	10.29	10.09	9.46	9.82	11.14	11.50	10.53	11.18	12.36	14.51	17.33	18.41	20.63	29.08	37.83	28.34	15.67	13.06	10.52	10.53
Days of sales outstanding (DSO)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Number of days of payables	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Cash conversion cycle	days	10.29	10.09	9.46	9.82	11.14	11.50	10.53	11.18	12.36	14.51	17.33	18.41	20.63	29.08	37.83	28.34	15.67	13.06	10.52	10.53

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 10.29 + — – —
= 10.29

The cash conversion cycle of Royal Caribbean Cruises Ltd has exhibited fluctuations over the analyzed periods, indicating shifts in the company's efficiency in managing its cash flow components.

From March 31, 2020, to June 30, 2020, the cash conversion cycle remained relatively stable at around 10-11 days. However, there was a noticeable increase in the cycle's length to 13.06 days by September 30, 2020, suggesting potential delays in converting resources into cash.

Subsequently, the cash conversion cycle continued to elongate, reaching its peak at 37.83 days by June 30, 2021. This significant extension may indicate challenges in efficiently managing the company's cash flow components, including receivables, payables, and inventory turnover.

From June 30, 2021, to December 31, 2021, there was a notable improvement as the cash conversion cycle decreased to 20.63 days. This reduction signified enhanced efficiency in converting resources into cash during the period.

The trend continued positively, with the cash conversion cycle registering further decreases in subsequent periods, reaching 9.46 days by June 30, 2024. This decline suggested improved effectiveness in managing cash flow components, resulting in quicker conversion of resources into cash.

Overall, the analysis of Royal Caribbean Cruises Ltd's cash conversion cycle indicates varying levels of efficiency in managing working capital components over the analyzed periods, with fluctuations reflecting the company's ability to optimize its cash flow operations.