RPM International Inc (RPM)
Cash conversion cycle
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 52.70 | 62.10 | 71.13 | 61.92 | 57.41 |
| Days of sales outstanding (DSO) | days | 71.85 | 76.96 | 79.04 | 77.68 | 76.83 |
| Number of days of payables | days | 35.80 | 37.24 | 46.95 | 47.34 | 37.92 |
| Cash conversion cycle | days | 88.76 | 101.82 | 103.23 | 92.26 | 96.32 |
May 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 52.70 + 71.85 – 35.80
= 88.76
The cash conversion cycle of RPM International Inc has shown fluctuations in recent years. In May 2024, the company's cash conversion cycle decreased to 88.76 days compared to 101.82 days in May 2023 and 103.23 days in May 2022. This indicates that the company took fewer days to convert its investments in inventory into cash receipts from sales.
It is also worth noting that the cash conversion cycle was lower in May 2024 compared to May 2021 and May 2020, which could imply improved efficiency in managing working capital. However, despite the improvement in 2024, the company's cash conversion cycle remains higher than the level observed in May 2021.
Overall, the trend in RPM International Inc's cash conversion cycle suggests a mix of efficiency improvements and challenges in working capital management. Further analysis would be needed to understand the underlying reasons for these fluctuations and to determine the effectiveness of the company's strategies in managing its cash conversion cycle.
Peer comparison
May 31, 2024