Tidewater Inc (TDW)

Cash conversion cycle

		Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019
Days of inventory on hand (DOH)	days	—	9.81	9.88	13.95	12.97	11.70	13.04	17.95	13.12	14.91	10.33	9.94	10.82	12.54	11.30	10.75	11.88	13.58	15.94	16.63
Days of sales outstanding (DSO)	days	—	—	—	1.25	—	—	—	—	—	—	8.27	—	75.88	73.55	68.14	68.16	56.01	51.96	96.30	97.30
Number of days of payables	days	22.78	22.15	20.65	19.62	26.97	36.32	34.54	22.68	20.12	21.50	18.47	16.39	14.63	13.18	10.54	11.50	8.64	11.29	22.31	20.93
Cash conversion cycle	days	-22.78	-12.34	-10.77	-4.42	-14.01	-24.62	-21.50	-4.73	-6.99	-6.59	0.13	-6.45	72.06	72.91	68.90	67.41	59.25	54.25	89.93	93.00

September 30, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + — – 22.78
= -22.78

The cash conversion cycle for Tidewater Inc has shown fluctuations over the historical periods analyzed. A negative cash conversion cycle indicates that the company is able to collect its accounts receivable more quickly than it pays its suppliers, resulting in a shorter time frame for converting its inventory into cash.

In the most recent period, as of September 30, 2024, the cash conversion cycle stands at -22.78 days, showing an improvement compared to the previous quarter. This suggests that Tidewater Inc has been more efficient in managing its working capital, particularly in terms of collecting receivables and managing inventory.

The trend over the past few quarters has been generally improving, with the cash conversion cycle decreasing from a peak of 89.93 days in March 2020 to the negative values in the recent quarters. This trend indicates that the company has been able to streamline its operations and enhance its cash flow management.

However, it is important to note that the company experienced a significant increase in the cash conversion cycle in late 2021 and early 2022, reaching a peak of 72.91 days. This could have been due to various factors such as changes in customer payment terms, inventory management issues, or supplier relations.

Overall, Tidewater Inc's cash conversion cycle analysis suggests that the company has made improvements in its working capital management, leading to a more efficient conversion of its resources into cash. Continued monitoring of this metric will be important to ensure sustained operational efficiency and financial performance.