Schlumberger NV (SLB)

Cash conversion cycle

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Days of inventory on hand (DOH)	days	2,214.74	2,156.03	1,863.15	1,663.33	145.93
Days of sales outstanding (DSO)	days	87.38	89.13	86.64	82.76	87.52
Number of days of payables	days	2,328.83	2,113.98	1,825.00	1,456.53	169.25
Cash conversion cycle	days	-26.71	131.18	124.80	289.56	64.20

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 2,214.74 + 87.38 – 2,328.83
= -26.71

The cash conversion cycle of Schlumberger Ltd. has fluctuated over the past five years, ranging from 77.51 days in 2019 to 92.61 days in 2022. The cycle measures the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales, then back into cash with accounts receivable. A lower cash conversion cycle indicates the company's ability to efficiently manage its working capital, while a higher cycle may signify potential liquidity challenges. Schlumberger's cash conversion cycle decreased from 92.61 days in 2022 to 82.95 days in 2023, suggesting improved efficiency in managing its working capital and converting sales into cash. Overall, the company's cash conversion cycle has shown variability over the years, and further analysis of its working capital management practices may offer insights into the company's operational efficiency.