Exxon Mobil Corp (XOM)
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 | 625.13 | 787.81 | 563.43 | 528.52 | 505.36 |
| Days of sales outstanding (DSO) | days | 40.27 | 36.84 | 41.38 | 41.39 | 37.15 |
| Number of days of payables | days | 1,053.54 | 1,439.33 | 1,139.61 | 710.40 | 864.77 |
| Cash conversion cycle | days | -388.14 | -614.69 | -534.80 | -140.49 | -322.26 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 625.13 + 40.27 – 1,053.54
= -388.14
The cash conversion cycle for Exxon Mobil Corp. over the past five years has shown fluctuations. In 2023, the company's cash conversion cycle increased to 41.03 days from 37.89 days in 2022, indicating a slight delay in converting its investments in inventory and accounts receivable into cash.
Comparing to previous years, the cash conversion cycle was higher in 2021 at 42.37 days and 2020 at 41.79 days, but lower in 2019 at 37.93 days. This suggests that Exxon Mobil Corp. improved its efficiency in managing its working capital in 2019 but faced challenges in 2021 and 2020.
The cash conversion cycle provides insights into how long it takes for the company to convert its resources into cash inflows, highlighting operational efficiency and liquidity management. Exxon Mobil Corp. should continue monitoring and improving its cash conversion cycle to optimize its working capital management and ensure sustainable financial performance.
Peer comparison
Dec 31, 2023