Westlake Chemical Corporation (WLK)

Cash conversion cycle

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Days of inventory on hand (DOH)	days	60.82	57.32	58.11	62.00	51.70
Days of sales outstanding (DSO)	days	44.58	46.57	41.62	57.89	59.05
Number of days of payables	days	30.50	30.99	27.68	38.73	30.19
Cash conversion cycle	days	74.90	72.90	72.05	81.16	80.56

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 60.82 + 44.58 – 30.50
= 74.90

The cash conversion cycle of Westlake Chemical Corporation has shown some fluctuations over the past five years. In December 2020, it stood at 80.56 days before increasing slightly to 81.16 days by December 2021. However, in the subsequent years, there was a noticeable improvement in efficiency as the cash conversion cycle decreased to 72.05 days by December 2022 and further to 72.90 days by December 2023. By the end of December 2024, the cash conversion cycle increased slightly to 74.90 days, but overall, it appears that Westlake Chemical Corporation has been effective in managing its working capital and turning its resources into cash efficiently over the years.