Victoria's Secret & Co (VSCO)
Cash conversion cycle
| Jan 31, 2025 | Feb 3, 2024 | Jan 31, 2024 | Jan 31, 2023 | Jan 28, 2023 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 88.34 | 60.31 | 91.41 | 93.97 | 65.46 |
| Days of sales outstanding (DSO) | days | — | 9.12 | — | — | 8.19 |
| Number of days of payables | days | — | 31.41 | — | — | 29.93 |
| Cash conversion cycle | days | 88.34 | 38.02 | 91.41 | 93.97 | 43.72 |
January 31, 2025 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 88.34 + — – —
= 88.34
The cash conversion cycle, a measure of how efficiently a company manages its working capital, provides insight into the time it takes for a company to convert its raw materials into cash from sales.
For Victoria's Secret & Co, the cash conversion cycle exhibited some fluctuations over time.
On January 28, 2023, the company's cash conversion cycle was relatively low at 43.72 days, indicating that the firm was efficient in managing its working capital. However, by January 31, 2023, the cycle increased significantly to 93.97 days, which suggested that Victoria's Secret & Co may have faced challenges in converting its inventory into cash during that period.
The cycle continued to improve by January 31, 2024, with a decrease to 91.41 days, though still remaining high. This was followed by a notable improvement to 38.02 days on February 3, 2024, indicating a positive trend in the company's working capital management.
Subsequently, by January 31, 2025, the cash conversion cycle increased to 88.34 days, showing a slight deterioration in efficiency compared to the previous period.
Overall, while the cash conversion cycle of Victoria's Secret & Co experienced fluctuations, the company may benefit from focusing on further optimizing its working capital management to enhance operational efficiency and maintain healthy cash flows.
Peer comparison
Jan 31, 2025