Universal Corporation (UVV)
Cash conversion cycle
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 27.68 | 30.71 | 36.10 | 28.77 | 20.30 |
| Days of sales outstanding (DSO) | days | 35.63 | 29.03 | 34.22 | 34.20 | 34.17 |
| Number of days of payables | days | 0.23 | 0.88 | 0.99 | — | — |
| Cash conversion cycle | days | 63.07 | 58.86 | 69.33 | 62.97 | 54.47 |
March 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 27.68 + 35.63 – 0.23
= 63.07
The cash conversion cycle of Universal Corporation has fluctuated over the past five years, with varying results in terms of how efficiently the company manages its cash flow. In the most recent fiscal year ending on March 31, 2024, the cash conversion cycle was 63.07 days, representing an increase from the previous year. This indicates that Universal Corporation took longer to convert its investments in inventory and accounts receivable into cash during the most recent period.
Comparing to four years ago, in 2020, the company had a lower cash conversion cycle of 54.47 days, suggesting that Universal Corporation was able to more efficiently manage its working capital and convert its assets into cash within a shorter timeframe at that point. The year 2022 stood out as having the highest cash conversion cycle at 69.33 days, signifying potential challenges in managing inventory levels and accounts receivable collections during that specific period.
Overall, fluctuations in the cash conversion cycle of Universal Corporation over the past five years indicate varying levels of efficiency in managing working capital and liquidity. The company may need to focus on optimizing inventory turnover and improving accounts receivable collection processes to enhance its cash conversion cycle and overall financial performance in the future.
Peer comparison
Mar 31, 2024