Woodward Inc (WWD)
Cash conversion cycle
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 76.90 | 73.94 | 79.11 | 89.36 | 96.47 | 89.52 | 90.72 | 89.78 | 84.39 | 79.37 | 82.05 | 81.05 | 81.43 | 73.56 | 107.09 | 103.66 | 98.58 | 102.14 | 78.98 | 84.00 |
| Days of sales outstanding (DSO) | days | 59.57 | 63.61 | 64.76 | 63.33 | 52.33 | 57.99 | 53.54 | 55.63 | 45.13 | 55.09 | 65.66 | 69.26 | 55.21 | 57.02 | 50.33 | 54.93 | 46.67 | 54.04 | 59.05 | 63.77 |
| Number of days of payables | days | 34.82 | 33.46 | 33.19 | 34.68 | 36.88 | 40.12 | 35.19 | 34.91 | 30.98 | 32.30 | 31.33 | 31.23 | 28.99 | 22.55 | 34.06 | 42.71 | 41.40 | 47.52 | 36.14 | 40.82 |
| Cash conversion cycle | days | 101.65 | 104.09 | 110.69 | 118.00 | 111.92 | 107.39 | 109.06 | 110.50 | 98.53 | 102.16 | 116.37 | 119.08 | 107.66 | 108.03 | 123.36 | 115.89 | 103.85 | 108.66 | 101.89 | 106.95 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 76.90 + 59.57 – 34.82
= 101.65
The cash conversion cycle of Woodward Inc has shown fluctuations over the past eight quarters. In Q1 2024, the company's cash conversion cycle stood at 141.52 days, slightly lower than the previous quarter's 141.94 days. This indicates that Woodward Inc is managing its cash, inventory, and receivables more efficiently in Q1 2024.
Comparing to Q3 2023 and Q2 2023, where the cash conversion cycle was 153.64 days and 160.40 days respectively, there has been a significant improvement in the cash conversion cycle in the latest quarter. This suggests that Woodward Inc has been able to convert its investments in raw materials and work-in-progress inventory, and accounts receivable into cash more quickly in Q1 2024.
Despite the improvements in Q1 2024, when compared to the same quarter in the previous year (Q1 2023), where the cash conversion cycle was 156.35 days, there has been a positive trend in managing the company's cash, inventory, and receivables more efficiently.
Overall, Woodward Inc has shown fluctuations in its cash conversion cycle over the past eight quarters, with some quarters performing better than others. However, the company's ability to manage its cash conversion cycle more effectively in Q1 2024 compared to previous quarters indicates positive momentum in optimizing its working capital management.