Bio-Techne Corp (TECH)

Cash conversion cycle

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Days of inventory on hand (DOH)	days	66.92	76.72	64.61	61.93	65.23
Days of sales outstanding (DSO)	days	76.00	70.12	64.89	57.86	30.67
Number of days of payables	days	14.14	11.48	15.50	15.59	14.60
Cash conversion cycle	days	128.78	135.36	113.99	104.21	81.30

June 30, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 66.92 + 76.00 – 14.14
= 128.78

The cash conversion cycle of Bio-Techne Corp has shown fluctuating trends over the past five years. The cycle represents the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales.

In the most recent fiscal year ending June 30, 2024, the cash conversion cycle was 128.78 days, showing a slight improvement compared to the prior year's cycle of 135.36 days. However, when compared to the cycles in the previous years, it is still longer than in fiscal year 2020 when the cycle was 81.30 days.

The upward trend in the cash conversion cycle from fiscal year 2020 to 2023 suggests that Bio-Techne Corp might be facing challenges in efficiently managing its working capital, particularly in terms of inventory turnover and collection of receivables. However, the improvement in the cycle in 2024 indicates potential efforts to streamline operations and enhance cash flow management.

Overall, Bio-Techne Corp should continue to focus on optimizing its cash conversion cycle to improve its liquidity position and operational efficiency, which can positively impact its financial performance and shareholder value in the long term.