SkyWest Inc (SKYW)
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 | 35.07 | 35.33 | 35.91 | 35.56 | 35.25 | 32.65 | 32.31 | 32.81 | 33.90 | 38.16 | 35.68 | 24.13 | 18.65 | 13.31 | 12.19 | 12.97 | 11.39 | 11.43 | 11.03 | 10.76 |
| Days of sales outstanding (DSO) | days | 12.45 | 12.22 | 12.25 | 10.87 | 10.47 | 17.67 | 15.83 | 15.03 | 12.38 | 11.30 | 11.79 | 11.42 | 8.99 | — | — | — | 6.09 | 0.58 | 2.73 | 2.37 |
| Number of days of payables | days | — | 119.14 | 128.19 | 131.60 | 130.41 | 125.00 | 119.57 | 121.18 | 116.10 | 122.60 | 135.67 | 90.50 | 88.94 | 57.68 | 37.28 | 42.87 | 34.80 | 30.22 | 36.38 | 41.82 |
| Cash conversion cycle | days | 47.52 | -71.59 | -80.02 | -85.17 | -84.69 | -74.68 | -71.43 | -73.35 | -69.82 | -73.13 | -88.20 | -54.95 | -61.30 | -44.37 | -25.09 | -29.90 | -17.32 | -18.20 | -22.62 | -28.68 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 35.07 + 12.45 – —
= 47.52
The cash conversion cycle for SkyWest Inc has shown significant fluctuations over the periods analyzed. The cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash inflows from sales.
Between March 2020 and June 2021, the company consistently maintained a negative cash conversion cycle, indicating efficient management of working capital and quick conversion of resources into cash. However, from September 2021 onwards, the cycle turned increasingly negative, reaching its lowest point of -88.20 days in June 2022. This suggests that the company may have been overly aggressive in managing its working capital, potentially risking stockouts or compromising relationships with suppliers.
From September 2022 to December 2024, the cash conversion cycle fluctuated within the negative range, indicating continued efficiency in converting resources into cash. However, it is worth noting that the cycle turned positive in December 2024, reaching 47.52 days. This shift may indicate a potential slowdown in the company's cash conversion efficiency, requiring closer monitoring to ensure optimal working capital management in the future.
Overall, while SkyWest Inc has demonstrated strong working capital management in the past, recent fluctuations in the cash conversion cycle suggest the need for continued vigilance and strategic planning to sustain efficiency and liquidity in the company's operations.
Peer comparison
Dec 31, 2024