Westlake Chemical Corporation (WLK)

Cash conversion cycle

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Days of inventory on hand (DOH)	days	60.82	61.93	60.21	59.01	57.32	58.49	55.02	58.39	58.11	64.80	71.92	74.70	62.00	54.60	49.42	52.18	51.70	46.75	47.33	50.27
Days of sales outstanding (DSO)	days	44.58	52.80	54.56	50.73	46.57	54.35	48.84	44.37	41.62	49.75	61.27	63.70	57.89	58.55	62.27	61.09	59.05	63.59	55.78	57.54
Number of days of payables	days	30.50	31.83	31.64	31.65	30.99	28.37	26.41	26.25	27.68	31.83	40.71	40.36	38.73	34.88	34.16	32.95	30.19	25.21	24.87	23.20
Cash conversion cycle	days	74.90	82.90	83.13	78.08	72.90	84.47	77.46	76.52	72.05	82.73	92.48	98.03	81.16	78.27	77.54	80.32	80.56	85.13	78.24	84.61

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 fluctuations over the periods analyzed. The company's cash conversion cycle, a measure of how long it takes for the company to convert its investments in inventory and other resources into cash inflows from sales, ranged from a low of 72.05 days on December 31, 2022, to a high of 98.03 days on March 31, 2022.

The trend in the cash conversion cycle indicates that the company was able to efficiently manage its working capital in some periods, resulting in a shorter cycle, while in other periods, the cycle was longer, potentially indicating challenges in managing inventory, collections, or payment processes.

Overall, it is important for Westlake Chemical Corporation to consistently monitor and optimize its cash conversion cycle to ensure efficient cash flow management and maximize liquidity.