Gibraltar Industries Inc (ROCK)
Cash conversion cycle
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 52.69 | 43.30 | 58.04 | 61.27 | 46.23 |
| Days of sales outstanding (DSO) | days | 47.23 | 59.49 | 57.02 | 64.42 | 69.99 |
| Number of days of payables | days | 44.78 | 33.10 | 36.31 | 59.90 | 63.36 |
| Cash conversion cycle | days | 55.14 | 69.69 | 78.75 | 65.78 | 52.86 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 52.69 + 47.23 – 44.78
= 55.14
The cash conversion cycle of Gibraltar Industries Inc has shown fluctuating trends over the past five years. In 2020, the cash conversion cycle stood at 52.86 days, indicating that the company took approximately 52.86 days to convert its invested cash back into cash through its operations.
However, in 2021, the cash conversion cycle increased to 65.78 days, signifying a longer time taken by the company to convert its cash back into cash. This suggests potential inefficiencies in the company's working capital management or operational processes.
By the end of 2022, the cash conversion cycle further extended to 78.75 days, reaching the highest point in the period under review. Such a prolonged cycle could indicate difficulties in managing the company's accounts receivable, inventory, and accounts payable efficiently.
In 2023, there was a slight improvement in the cash conversion cycle, which decreased to 69.69 days. Although the cycle shortened, it still remained at a relatively high level, highlighting continued challenges in working capital management.
By the end of 2024, Gibraltar Industries Inc managed to reduce its cash conversion cycle to 55.14 days, showing efforts to optimize its working capital efficiency. However, the cycle remained higher than the initial 2020 level, indicating that there may still be room for improvement in managing the company's cash flows.
Overall, the fluctuating trend in the cash conversion cycle of Gibraltar Industries Inc over the past five years suggests a need for continuous monitoring and improvement in the company's working capital management practices to enhance liquidity and operational efficiency.
Peer comparison
Dec 31, 2024