STERIS plc (STE)

Cash conversion cycle

		Mar 31, 2025	Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021
Days of inventory on hand (DOH)	days	69.42	84.83	99.34	81.70	65.18
Days of sales outstanding (DSO)	days	69.79	71.62	74.69	63.61	71.58
Number of days of payables	days	33.53	31.66	39.94	32.08	32.47
Cash conversion cycle	days	105.68	124.80	134.09	113.24	104.29

March 31, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 69.42 + 69.79 – 33.53
= 105.68

The cash conversion cycle for STERIS plc has shown some fluctuations over the years.

As of March 31, 2021, the company's cash conversion cycle was 104.29 days, indicating that it took approximately 104 days for STERIS to convert its investments in inventory and other resources into cash inflows from sales.

By March 31, 2022, the cash conversion cycle had increased to 113.24 days, suggesting a slight delay in the company's ability to convert its resources into cash.

The cycle further extended to 134.09 days by March 31, 2023, indicating a longer period for STERIS to receive cash from its operational activities, possibly due to factors like increased inventory holding periods or slower collection of receivables.

Although the cash conversion cycle decreased to 124.80 days by March 31, 2024, it was still on the higher side, potentially indicating inefficiencies in working capital management.

Interestingly, as of March 31, 2025, the cash conversion cycle is recorded as 0.00 days. This could be due to data reporting anomalies or optimizations in the company's operational and financial processes that allow STERIS to convert its resources into cash almost instantaneously.

Overall, fluctuations in STERIS plc's cash conversion cycle over the years may reflect changes in its operating efficiency, working capital management practices, and industry dynamics. Monitoring this metric can provide valuable insights into the company's liquidity, efficiency, and overall financial health.