Willscot Mobile Mini Holdings Corp A (WSC)
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 | 15.84 | 16.78 | 14.87 | 12.90 | 11.17 |
| Days of sales outstanding (DSO) | days | 65.57 | 69.63 | 69.80 | 67.67 | 88.32 |
| Number of days of payables | days | 32.23 | 30.49 | 39.17 | 40.40 | 55.15 |
| Cash conversion cycle | days | 49.18 | 55.92 | 45.51 | 40.16 | 44.34 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 15.84 + 65.57 – 32.23
= 49.18
The cash conversion cycle (CCC) for Willscot Mobile Mini Holdings Corp A has displayed fluctuations over the analyzed period from December 31, 2020, to December 31, 2024.
Initially, at the close of 2020, the CCC was approximately 44.34 days. This figure decreased slightly in 2021 to around 40.16 days, indicating an improvement in the company's ability to convert its investments in inventory and receivables into cash more swiftly. However, this positive trend was interrupted in 2022, when the cycle increased to approximately 45.51 days, reflecting a slowdown in cash realization processes or potential shifts in operational efficiencies or working capital management.
The upward trend intensified in 2023, with the CCC rising substantially to approximately 55.92 days. This increase suggests a lengthening of the time required for the company to convert its resources into cash, which could be driven by factors such as increased inventory holdings, extended receivables periods, or delays in cash collection. This expansion in the cycle indicates a potential deterioration in working capital management efficiency, possibly impacting liquidity.
Subsequently, in 2024, the CCC saw a reduction to approximately 49.18 days. While this indicates a partial recovery towards earlier levels, the cycle remained higher than the figures recorded at the beginning of the observation period. The decrease could suggest efforts to improve cash conversion processes, but the overall extended cycle duration compared to 2020 and 2021 highlights ongoing challenges in maintaining optimal working capital performance.
Overall, the data illustrates a trend of increased cash conversion cycle duration over the period, with notable expansion in 2023, followed by some improvement in 2024. This pattern underscores the importance of monitoring and optimizing inventory, receivables, and payables management to enhance liquidity and operational efficiency.