RadNet Inc (RDNT)

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 — — — — — — — — — — — — — — — — — — — —
Days of sales outstanding (DSO) days 37.20 40.98 41.59 41.74 36.96 38.75 41.67 48.56 47.30 46.61 45.78 45.03 38.98 44.91 47.82 50.90 46.12 47.25 43.57 45.61
Number of days of payables days 290.83 — — — 399.64 — — — 357.96 — — — 346.01 — — — 283.55 — — —
Cash conversion cycle days -253.63 40.98 41.59 41.74 -362.68 38.75 41.67 48.56 -310.66 46.61 45.78 45.03 -307.03 44.91 47.82 50.90 -237.43 47.25 43.57 45.61

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 37.20 – 290.83
= -253.63

The cash conversion cycle measures how long a company takes to convert its investments in inventory and other resources into cash flows from sales. For RadNet Inc, the cash conversion cycle has shown fluctuations over the analyzed period.

From March 31, 2020, to December 31, 2024, the cash conversion cycle has ranged from a positive 45.03 days to a negative 362.68 days. During this period, RadNet Inc experienced both positive and negative cash conversion cycles, indicating variability in its working capital management efficiency.

A positive cash conversion cycle suggests that RadNet takes time to convert its investments in inventory and other resources into cash from sales, potentially tying up cash in its operations for an extended period. Conversely, a negative cash conversion cycle implies that RadNet is able to convert its investments into cash more quickly than it pays its suppliers, leading to efficient working capital management and a potential source of liquidity for the company.

Overall, the fluctuating nature of RadNet's cash conversion cycle over the years highlights the importance of monitoring working capital efficiency and managing cash flows effectively to support the company's operational activities and financial health.