Sensata Technologies Holding NV (ST)

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	80.76	93.25	86.79	84.45	77.68
Days of sales outstanding (DSO)	days	—	—	—	—	—
Number of days of payables	days	—	—	—	—	—
Cash conversion cycle	days	80.76	93.25	86.79	84.45	77.68

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 80.76 + — – —
= 80.76

The cash conversion cycle of Sensata Technologies Holding NV has shown a fluctuating trend over the past five years based on the provided data.

As of December 31, 2020, the company's cash conversion cycle stood at 77.68 days, indicating that on average, it takes approximately 77.68 days for Sensata to convert its investments in inventory and accounts receivable into cash flow from sales.

By December 31, 2021, the cash conversion cycle increased to 84.45 days, signifying a longer period for Sensata to convert its investments into cash. This could suggest potential issues with inventory management efficiency or delayed collection of receivables during that period.

Subsequently, by December 31, 2022, the cash conversion cycle further extended to 86.79 days, and then to 93.25 days by December 31, 2023. These rising values indicate that Sensata was taking more time to convert its operating cycle components into cash, potentially facing challenges in managing working capital effectively.

However, by December 31, 2024, there was a notable decrease in the cash conversion cycle to 80.76 days, reflecting an improvement in the company's efficiency in converting investments in inventory and receivables into cash.

Overall, the fluctuation in Sensata's cash conversion cycle over the five-year period suggests variations in the company's liquidity management and operational efficiency. It is crucial for Sensata to continue monitoring and optimizing its cash conversion cycle to enhance its working capital management and overall financial performance.