WESCO International Inc (WCC)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 62.15 | 63.91 | 55.88 | 65.93 | 54.48 |
| Days of sales outstanding (DSO) | days | 91.64 | 95.99 | 92.19 | 108.27 | 74.96 |
| Number of days of payables | days | 42.30 | 49.83 | 44.86 | 52.02 | 44.73 |
| Cash conversion cycle | days | 111.48 | 110.07 | 103.21 | 122.17 | 84.72 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 62.15 + 91.64 – 42.30
= 111.48
The cash conversion cycle of Wesco International, Inc. has exhibited fluctuations over the past five years. In 2023, the company's cash conversion cycle was 90.10 days, an increase from the previous year's 86.62 days. The trend in 2023 suggests that the company took slightly longer to convert its investments in inventory into cash during the year compared to 2022.
Compared to 2021, when the cash conversion cycle was 80.10 days, there was an increase in 2023, indicating a longer operating cycle. Similarly, in 2020, Wesco International had a higher cash conversion cycle of 96.80 days, implying that the company improved its efficiency in converting its resources into cash by reducing the cycle in 2023.
The most efficient performance in recent years was in 2019, with a cash conversion cycle of 66.60 days, indicating that Wesco International was able to convert its investments in inventory into cash quickly during that period.
Overall, the varying cash conversion cycle figures reflect changes in the company's management of inventory, payables, and receivables. It is important for Wesco International to continue monitoring and optimizing its cash conversion cycle to enhance its operational efficiency and financial performance.
Peer comparison
Dec 31, 2023