Regal Beloit Corporation (RRX)
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 | 116.54 | 122.73 | 115.89 | 110.63 | 111.17 | 119.58 | 151.93 | 180.80 | 137.53 | 138.33 | 152.96 | 160.91 | 148.25 | 122.44 | 120.08 | 123.40 | 120.08 | 118.88 | 117.41 | 104.49 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 116.54 | 122.73 | 115.89 | 110.63 | 111.17 | 119.58 | 151.93 | 180.80 | 137.53 | 138.33 | 152.96 | 160.91 | 148.25 | 122.44 | 120.08 | 123.40 | 120.08 | 118.88 | 117.41 | 104.49 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 116.54 + — – —
= 116.54
The cash conversion cycle of Regal Beloit Corporation has shown some fluctuations over the years. From March 31, 2020, to December 31, 2024, the cash conversion cycle ranged from a low of 104.49 days to a high of 180.80 days.
The cash conversion cycle measures how long it takes for a company to convert its investments in inventory and other resources into cash flows from sales. Generally, a shorter cash conversion cycle is preferred as it indicates that the company is efficiently managing its working capital.
In the case of Regal Beloit Corporation, we observed that the cash conversion cycle peaked at 180.80 days on March 31, 2023, indicating a deterioration in the efficiency of the company's working capital management. However, the company made significant improvements by reducing the cash conversion cycle to 110.63 days by March 31, 2024.
It is important for Regal Beloit Corporation to continuously monitor and manage its cash conversion cycle to ensure optimal efficiency in its operations and maximize its cash flows. By analyzing the trend of the cash conversion cycle, the company can identify areas for improvement and implement strategies to enhance working capital management.
Peer comparison
Dec 31, 2024