Smurfit WestRock plc (SW)
Cash conversion cycle
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Dec 31, 2022 | Jun 30, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 68.15 | 79.51 | — | — | 26.38 | — | 23.00 | 25.88 | — | — |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 68.15 | 79.51 | 0.00 | 0.00 | 26.38 | 0.00 | 23.00 | 25.88 | 0.00 | 0.00 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 68.15 + — – —
= 68.15
The cash conversion cycle is a key metric that measures the time it takes for a company to convert its investments in inventory and other resources into cash inflows from sales. For Smurfit WestRock plc, the cash conversion cycle has shown fluctuations over the past few periods:
1. December 31, 2021 - June 30, 2022: Both periods exhibited a cash conversion cycle of 0.00 days, indicating that the company was effectively managing its working capital during this time.
2. December 31, 2022 - June 30, 2023: There was an increase in the cash conversion cycle from 0.00 days to 25.88 days by the end of December 2022, followed by a slight improvement to 23.00 days by June 30, 2023. This suggests a possible delay in converting inventory into cash during the initial period, but some progress was made in the following months.
3. September 30, 2023 - June 30, 2024: The cash conversion cycle again showed periods of 0.00 days, indicating efficient working capital management at these points.
4. September 30, 2024 - December 31, 2024: However, by the end of September 2024, the cash conversion cycle significantly increased to 79.51 days and then improved slightly to 68.15 days by the end of December 2024. This increase may suggest issues with inventory management or collection of receivables during this period.
In summary, the cash conversion cycle for Smurfit WestRock plc has displayed variations over the analyzed periods, signifying fluctuations in the efficiency of converting working capital into cash inflows. Monitoring this metric can provide insights into the company's liquidity, operational efficiency, and potential areas for improvement in managing its working capital cycle.
Peer comparison
Dec 31, 2024