Visteon Corp (VC)

Cash conversion cycle

		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	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	29.57	30.77	31.45	35.28	35.41	37.33	37.35	43.27	35.18	34.68	28.55	28.23	28.05	26.66	27.65	25.87	23.53	26.79	26.58	27.81
Days of sales outstanding (DSO)	days	91.30	80.50	75.60	73.80	81.44	87.52	78.49	75.15	92.24	70.81	64.25	71.79	94.83	86.11	59.68	57.23	83.29	67.10	59.27	65.17
Number of days of payables	days	54.67	57.58	53.92	59.62	66.85	70.61	59.82	70.46	70.10	57.02	58.05	72.97	79.24	80.32	54.00	63.52	71.16	64.74	63.53	62.76
Cash conversion cycle	days	66.20	53.69	53.14	49.46	49.99	54.24	56.03	47.96	57.32	48.47	34.75	27.04	43.64	32.46	33.33	19.58	35.66	29.15	22.32	30.22

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 29.57 + 91.30 – 54.67
= 66.20

The cash conversion cycle of Visteon Corp. has shown fluctuations over the past four quarters, ranging from 40.35 days to 57.95 days. In Q4 2023, the cash conversion cycle was 41.31 days, indicating that, on average, it takes the company approximately 41.31 days to convert its investments in raw materials and other resources into cash receipts from sales.

It is noteworthy that the cash conversion cycle decreased in Q4 2023 compared to the previous quarter, suggesting an improvement in the company's efficiency in managing its working capital. However, Visteon Corp. experienced a longer cash conversion cycle in Q3 and Q2 2023, which could be a cause for concern as it may indicate delays in converting inventory into sales and subsequently collecting cash from customers.

Overall, Visteon Corp. should continue to monitor and manage its cash conversion cycle effectively to ensure optimal working capital management and sustainable cash flow operations.