Xerox Corp (XRX)
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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 133.58 | 130.20 | 130.40 | 126.54 | 117.81 | 135.78 | 144.89 | 160.63 | 143.23 | 141.94 | 141.17 | 135.08 | 128.17 | 136.64 | 137.78 | 143.44 | 133.09 | 153.07 | 139.99 |
| Days of sales outstanding (DSO) | days | 45.00 | 58.20 | 59.94 | 74.42 | 44.14 | 81.95 | 83.71 | 41.04 | 43.28 | 42.74 | 43.22 | 92.33 | 93.01 | 95.52 | 94.07 | 95.17 | 99.77 | 92.72 | 81.93 |
| Number of days of payables | days | 196.63 | 159.20 | 165.60 | 179.84 | 186.06 | 192.29 | 192.88 | 242.15 | 239.20 | 221.59 | 222.73 | 218.30 | 196.86 | 178.95 | 158.07 | 158.96 | 155.19 | 159.34 | 139.08 |
| Cash conversion cycle | days | -18.05 | 29.20 | 24.73 | 21.12 | -24.12 | 25.44 | 35.73 | -40.48 | -52.69 | -36.91 | -38.34 | 9.11 | 24.32 | 53.21 | 73.78 | 79.65 | 77.66 | 86.45 | 82.84 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 133.58 + 45.00 – 196.63
= -18.05
The cash conversion cycle of Xerox Corp has shown fluctuations over the periods analyzed. It decreased from 82.84 days as of June 30, 2020, to -52.69 days as of December 31, 2022, indicating an improvement in the efficiency of the company's cash management and working capital cycle. A negative cash conversion cycle suggests that Xerox is able to generate cash from its operations before paying its suppliers, which could be a sign of strong financial health.
However, there were subsequent oscillations in the cash conversion cycle, with variations in positive and negative territory until December 31, 2024. The cycle turned negative again to -18.05 days by the end of December 31, 2024. This could imply that Xerox was able to manage its cash flow effectively during this period, allowing for a shorter cycle from inventory to receivables to payables.
Overall, the trend in Xerox's cash conversion cycle indicates the company's ability to efficiently manage its working capital and convert its inventory and receivables into cash, albeit with some fluctuations. The recent improvement in the cycle suggests enhanced operational efficiency and effective management of liquidity.
Peer comparison
Dec 31, 2024