Xerox Corp (XRX)
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 | 133.65 | 117.46 | 143.30 | 128.43 | 137.79 |
| Days of sales outstanding (DSO) | days | 44.53 | 44.10 | 43.14 | 93.05 | 98.74 |
| Number of days of payables | days | 196.73 | 185.52 | 239.32 | 197.26 | 160.68 |
| Cash conversion cycle | days | -18.54 | -23.96 | -52.88 | 24.22 | 75.85 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 133.65 + 44.53 – 196.73
= -18.54
The cash conversion cycle of Xerox Corp has exhibited significant changes over the analyzed period.
Starting at 75.85 days on December 31, 2020, the company took approximately 75.85 days to convert its investment in inventory into cash receipts from sales. Subsequently, there was a notable improvement as the days decreased to 24.22 on December 31, 2021, indicating a more efficient management of inventory, receivables, and payables.
The trend continued with a substantial shift to negative values, reaching -52.88 days by December 31, 2022. This implies that Xerox Corp took less than a month to convert its investments into cash during this period. The negative values suggest that the company was able to collect cash from customers before paying its suppliers, leading to a more favorable cash position and potentially improved liquidity.
The negative trend continued in the following years, with the cash conversion cycle further decreasing to -23.96 days on December 31, 2023, and -18.54 days by December 31, 2024. These consistently negative values indicate that Xerox Corp continued to efficiently manage its working capital components, indicating strong cash flow management and potentially enhanced financial performance.
Overall, the decreasing trend in the cash conversion cycle reflects an improvement in operational efficiency and working capital management for Xerox Corp over the analyzed period.
Peer comparison
Dec 31, 2024