Telephone and Data Systems Inc (TDS)

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	32.29	53.81	37.75	32.51	34.99
Days of sales outstanding (DSO)	days	70.17	75.86	84.93	83.06	73.27
Number of days of payables	days	55.89	101.59	102.01	107.24	77.43
Cash conversion cycle	days	46.57	28.08	20.67	8.33	30.83

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 32.29 + 70.17 – 55.89
= 46.57

Telephone And Data Systems, Inc.'s cash conversion cycle has fluctuated over the past five years. The company's cash conversion cycle was 52.48 days at the end of 2023, showing an increase compared to the previous year. This indicates that it took the company longer to convert its investments in inventory and other resources into cash during the year.

In 2022, the cash conversion cycle was 49.75 days, also higher than in 2021, which had a cash conversion cycle of 46.70 days. However, in 2020, the company saw a significant improvement with a cash conversion cycle of 35.85 days, indicating more efficient management of its working capital.

The cash conversion cycle then increased in 2019 to 49.78 days, similar to the 2022 levels. Overall, fluctuations in the cash conversion cycle suggest varying levels of efficiency in managing the company's cash resources, inventory, and accounts receivable over the years. Further analysis and comparison with industry benchmarks would provide more insights into the company's working capital management efficiency.