Analysis of Short-term (Operating) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
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- Common-Size Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Common Stock Valuation Ratios
- Enterprise Value (EV)
- Capital Asset Pricing Model (CAPM)
- Dividend Discount Model (DDM)
- Selected Financial Data since 2012
- Operating Profit Margin since 2012
- Total Asset Turnover since 2012
- Price to Sales (P/S) since 2012
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Short-term Activity Ratios (Summary)
Diamondback Energy Inc., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Inventory Turnover
- The inventory turnover ratio experienced fluctuations over the observed period. It started at a high level of 130.25 in 2017, declined sharply to 56.69 in 2018, rose again to 105.05 in 2019, dipped to 83.52 in 2020, and increased to 108.82 in 2021. This indicates variability in inventory management efficiency with a general tendency toward improvement after 2018.
- Receivables Turnover
- The receivables turnover ratio shows a steady increase from 7.48 in 2017 to 11.28 in 2021. This suggests an improving effectiveness in collecting receivables over time, indicating potentially enhanced cash flow management or tighter credit policies.
- Payables Turnover
- The payables turnover ratio exhibits a significant upward trend, moving from 12.54 in 2017 to a striking 187.42 in 2021. The steep increase in 2021 implies a dramatic acceleration in payment to suppliers, signaling either a change in payment strategy or improved liquidity position.
- Working Capital Turnover
- Working capital turnover data is only available for 2021, with a high ratio of 843.38. Without prior periods for comparison, trend analysis is limited, but the figure suggests exceptionally high efficiency in using working capital to generate sales in that year.
- Average Inventory Processing Period
- The average inventory processing period remains relatively stable and low, fluctuating between 3 and 6 days across the periods, with a return to 3 days by 2021. This consistency at a short processing time indicates efficient inventory management.
- Average Receivable Collection Period
- This period decreased steadily from 49 days in 2017 to 32 days in 2021. This reflects improved efficiency in collecting outstanding receivables, contributing positively to cash flow timing.
- Operating Cycle
- The operating cycle shows a gradual reduction from 52 days in 2017 to 35 days in 2021, aligning with improvements in both inventory processing and receivables collection periods. This contraction suggests increased overall operating efficiency.
- Average Payables Payment Period
- The average payables payment period decreases significantly from 29 days in 2017 to only 2 days in 2021. This considerable reduction corresponds with the dramatic rise in payables turnover, indicating the company pays suppliers much faster over time, possibly affecting cash outflows.
- Cash Conversion Cycle
- The cash conversion cycle shows moderate variability, starting at 23 days in 2017, rising to 35 days in 2018, then fluctuating around the low 30s through 2021. Despite improvements in receivables and inventory periods, the reduction in payables payment period offsets cash cycle benefits, resulting in a relatively stable cash conversion duration.
Turnover Ratios
Average No. Days
Inventory Turnover
Diamondback Energy Inc., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue from contracts with customers | ||||||
| Inventories | ||||||
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | ||||||
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Inventory Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Inventory Turnover, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Inventory turnover = Revenue from contracts with customers ÷ Inventories
= ÷ =
2 Click competitor name to see calculations.
- Revenue from contracts with customers
- Revenue demonstrated significant growth over the analyzed periods, increasing from $1,186 million in 2017 to $6,747 million in 2021. Despite a decline observed in 2020, where revenue dropped to $2,756 million from $3,887 million in 2019, there was a strong recovery in 2021, nearly doubling the previous year's revenue. This overall upward trend indicates substantial expansion and increasing sales activity.
- Inventories
- Inventory levels fluctuated throughout the years but generally exhibited an increasing pattern. Starting from $9 million in 2017, inventories rose to $62 million in 2021. A notable increase occurred in 2018 to $38 million, followed by slight declines in 2019 and 2020, before sharply increasing again in 2021. This variability may reflect changes in production levels, supply chain dynamics, or inventory management strategies.
- Inventory turnover
- The inventory turnover ratio showed variability across the periods with no consistent directional trend. The ratio decreased substantially from 130.25 in 2017 to 56.69 in 2018, indicating slower inventory movement relative to preceding years. It rebounded to 105.05 in 2019, then decreased again to 83.52 in 2020, followed by another increase to 108.82 in 2021. These fluctuations suggest changing efficiency in inventory management, potentially linked to variations in sales volume and inventory levels.
Receivables Turnover
Diamondback Energy Inc., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue from contracts with customers | ||||||
| Accounts receivable, oil and natural gas sales, net | ||||||
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | ||||||
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Receivables Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Receivables Turnover, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Receivables turnover = Revenue from contracts with customers ÷ Accounts receivable, oil and natural gas sales, net
= ÷ =
2 Click competitor name to see calculations.
- Revenue from contracts with customers
- The revenue exhibited a general upward trend over the analyzed period. Starting at $1,186 million in 2017, it nearly doubled to $2,130 million in 2018 and continued its strong growth to $3,887 million in 2019. However, a notable decline occurred in 2020, with revenue decreasing to $2,756 million. This was followed by a significant rebound in 2021, where revenue surged to its highest level of $6,747 million. The pattern suggests volatility possibly influenced by external market conditions, but an overall strong growth trajectory across the five years.
- Accounts receivable, oil and natural gas sales, net
- Accounts receivable displayed fluctuations consistent with revenue movements. The balance increased steadily from $159 million in 2017 to $429 million in 2019, then decreased to $281 million in 2020. In 2021, the receivables rose sharply again to $598 million. The fluctuations generally correspond with the revenue trends, indicating alignment between sales activities and receivables management.
- Receivables turnover ratio
- This ratio, indicating the efficiency in collecting receivables, showed continuous improvement throughout the period. It decreased slightly from 7.48 in 2017 to 7.18 in 2018, then increased significantly to 9.06 in 2019 and further to 9.81 in 2020. The upward trend culminated in 2021 with the highest turnover ratio of 11.28, suggesting enhanced efficiency in managing accounts receivable and faster collection cycles over time.
Payables Turnover
Diamondback Energy Inc., payables turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue from contracts with customers | ||||||
| Accounts payable, trade | ||||||
| Short-term Activity Ratio | ||||||
| Payables turnover1 | ||||||
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Payables Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Payables Turnover, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Payables turnover = Revenue from contracts with customers ÷ Accounts payable, trade
= ÷ =
2 Click competitor name to see calculations.
- Revenue from contracts with customers
- The revenue exhibited a generally increasing trend over the five-year period. Starting at $1,186 million in 2017, it rose sharply to $2,130 million in 2018 and continued to increase significantly to $3,887 million in 2019. In 2020, there was a notable decline to $2,756 million, which was likely influenced by external factors affecting the market or operational challenges. However, the following year saw a remarkable recovery and substantial growth, with revenue reaching $6,747 million by the end of 2021, the highest level in the observed period.
- Accounts payable, trade
- Accounts payable showed a fluctuating pattern, with values declining over time. From $95 million in 2017, the amount increased somewhat to $128 million in 2018 and $179 million in 2019, indicating growing obligations to suppliers during this period. Then, a significant reduction occurred in 2020, with accounts payable falling sharply to $71 million, and continuing to decrease further to $36 million by 2021, which could indicate improved payment practices or changes in procurement.
- Payables turnover
- The payables turnover ratio experienced a dramatic increase throughout the period. Starting at 12.54 in 2017, the ratio steadily increased to 16.64 in 2018 and 21.72 in 2019. A sharper rise was seen in 2020, reaching 38.82, followed by an extraordinary surge to 187.42 in 2021. This significant increase suggests that the company accelerated its rate of payments to suppliers considerably, which may reflect stronger liquidity, improved operational efficiency, or a strategic shift toward faster settlement of liabilities.
Working Capital Turnover
Diamondback Energy Inc., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | ||||||
| Less: Current liabilities | ||||||
| Working capital | ||||||
| Revenue from contracts with customers | ||||||
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | ||||||
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Working Capital Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Working Capital Turnover, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Working capital turnover = Revenue from contracts with customers ÷ Working capital
= ÷ =
2 Click competitor name to see calculations.
- Working Capital
- The working capital shows a predominantly negative trend from 2017 through 2020, starting at -219 million US dollars in 2017 and worsening to -634 million US dollars by the end of 2020. This indicates increasing short-term liabilities relative to current assets over these years. Notably, in 2021, working capital sharply improved to a positive 8 million US dollars, suggesting a significant adjustment in the company's liquidity position or current asset management during that year.
- Revenue from Contracts with Customers
- Revenue exhibits a strong upward trend overall. Beginning at 1,186 million US dollars in 2017, revenue increased substantially each year with the exception of a decline in 2020. After reaching 3,887 million US dollars in 2019, it dropped to 2,756 million US dollars in 2020, likely reflecting market or operational impacts during that period. However, the revenue rebounded sharply in 2021 to 6,747 million US dollars, representing the highest revenue level in the dataset and indicating a significant recovery and growth phase.
- Working Capital Turnover
- The working capital turnover ratio is only reported for 2021, at 843.38. While the lack of prior data prevents trend analysis, the extremely high ratio in 2021 typically implies very high revenue generation in relation to the level of working capital, which is consistent with the positive working capital and record revenue observed in that year. It may also reflect efficient use of working capital to drive sales.
Average Inventory Processing Period
Diamondback Energy Inc., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | ||||||
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | ||||||
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Average Inventory Processing Period, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Average Inventory Processing Period, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ =
2 Click competitor name to see calculations.
- Inventory Turnover
- The inventory turnover ratio exhibited significant fluctuations over the five-year period. It started at a very high level of 130.25 in 2017, sharply declined to 56.69 in 2018, then rebounded to 105.05 in 2019. This was followed by a decrease to 83.52 in 2020, and an increase again to 108.82 in 2021. These variations suggest changes in inventory management efficiency and possibly sales volume or inventory levels year over year.
- Average Inventory Processing Period
- The average inventory processing period remained relatively stable and low throughout the period, ranging between 3 to 6 days. It started at 3 days in 2017, increased to 6 days in 2018, then reverted to 3 days in 2019. It slightly increased to 4 days in 2020 before returning again to 3 days in 2021. This indicates a fairly consistent and efficient inventory turnover process in terms of days, despite fluctuations in the turnover ratio.
- Overall Analysis
- The inverse relationship between inventory turnover and average inventory processing days is typical, with higher turnover generally corresponding to fewer days in inventory. The notable dip in turnover ratio and corresponding increase in processing period in 2018 may indicate operational or market challenges that affected inventory movement that year. Subsequent years show recovery and sustained effectiveness in inventory management. The company appears to maintain a rapid inventory baseline turnover cycle, which is conducive to operational efficiency.
Average Receivable Collection Period
Diamondback Energy Inc., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | ||||||
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | ||||||
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Average Receivable Collection Period, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Average Receivable Collection Period, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
- Receivables Turnover
- The receivables turnover ratio exhibits a clear upward trend over the five-year period analyzed. Starting at 7.48 in 2017, it slightly declined to 7.18 in 2018 but subsequently increased each year, reaching 11.28 by the end of 2021. This progression indicates an improving efficiency in collecting receivables.
- Average Receivable Collection Period
- The average receivable collection period shows a consistent decline from 49 days in 2017 to 32 days in 2021. This decrease suggests that the company is reducing the time it takes to collect payments from its customers. Notably, the reduction accelerates after 2018, moving from 51 days down to 37 days in 2020, and further to 32 days in 2021.
- Overall Analysis
- The inverse relationship observed between the receivables turnover ratio and the average collection period confirms enhanced receivables management over the timeframe. The increasing turnover ratio coupled with the decreasing collection days highlights improved cash flow dynamics, reflecting positively on liquidity and credit control practices.
Operating Cycle
Diamondback Energy Inc., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | ||||||
| Average receivable collection period | ||||||
| Short-term Activity Ratio | ||||||
| Operating cycle1 | ||||||
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Operating Cycle, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Operating Cycle, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= + =
2 Click competitor name to see calculations.
- Average inventory processing period
- The average inventory processing period exhibited fluctuations over the analyzed years, starting at 3 days in 2017, peaking at 6 days in 2018, and then returning to 3 days by 2021. This indicates some variability in inventory turnover efficiency, with a quicker processing period reestablished in the latter years.
- Average receivable collection period
- The average receivable collection period showed a consistent downward trend from 49 days in 2017 to 32 days in 2021. This reduction suggests an improvement in the speed of collecting receivables, enhancing cash flow and potentially indicating better credit management or customer payment behaviors.
- Operating cycle
- The operating cycle, which combines the inventory processing and receivable collection periods, declined steadily from 52 days in 2017 to 35 days in 2021. This trend reflects an overall improvement in operational efficiency, suggesting that the company is managing its working capital more effectively by reducing the time lag between inventory acquisition and cash collection.
Average Payables Payment Period
Diamondback Energy Inc., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | ||||||
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | ||||||
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Average Payables Payment Period, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Average Payables Payment Period, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
- Payables Turnover
- The payables turnover ratio exhibited a consistent and substantial increase over the five-year period. Starting at 12.54 in 2017, the ratio rose moderately to 16.64 in 2018 and then to 21.72 in 2019. A significant acceleration occurred thereafter, with the ratio jumping to 38.82 in 2020 and experiencing a dramatic surge to 187.42 by 2021. This trend indicates that the company increasingly accelerated its rate of settling payables each year, with particularly pronounced changes in the last two years.
- Average Payables Payment Period
- The average payables payment period, measured in days, demonstrated a sharp downward trend throughout the period. It decreased from 29 days in 2017 to 22 days in 2018 and further to 17 days in 2019. The pace of reduction intensified thereafter, falling to 9 days in 2020 and reaching a very short duration of only 2 days by 2021. This pattern reflects a significant improvement in payment efficiency, suggesting that the company was paying its suppliers much faster over time.
- Overall Insights
- The inverse relationship between the payables turnover ratio and the average payment period is evident and logically consistent. The company has been markedly improving its payment cycle speed, possibly indicating stronger liquidity or a strategic decision to take advantage of supplier terms or negotiate more favorable conditions through prompt payments. The steep acceleration from 2020 to 2021 may be due to operational changes, cash flow strategies, or shifts in supplier relationships. However, such rapid shortening of the payment period could also impact working capital management and supplier negotiations in the longer term.
Cash Conversion Cycle
Diamondback Energy Inc., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | ||||||
| Average receivable collection period | ||||||
| Average payables payment period | ||||||
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | ||||||
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Cash Conversion Cycle, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Cash Conversion Cycle, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= + – =
2 Click competitor name to see calculations.
- Average Inventory Processing Period
- The average inventory processing period remained relatively stable over the years, fluctuating between 3 and 6 days. It peaked at 6 days in 2018 but returned to shorter periods of 3 to 4 days in subsequent years, indicating consistent efficiency in inventory turnover.
- Average Receivable Collection Period
- There is a clear downward trend in the average receivable collection period, decreasing from 49 days in 2017 to 32 days in 2021. This suggests improvements in the speed of cash collection from customers, which enhances liquidity and reduces credit risk.
- Average Payables Payment Period
- The average payables payment period demonstrated a significant decline from 29 days in 2017 to just 2 days in 2021. This indicates the company has been accelerating its payments to suppliers over time, which could reflect improved cash availability or changes in supplier payment terms.
- Cash Conversion Cycle
- The cash conversion cycle showed some fluctuations, starting at 23 days in 2017, rising to 35 days in 2018, then decreasing and stabilizing around 32-33 days in 2020 and 2021. Despite efforts in shortening receivables and inventory periods, the cycle remains elevated primarily due to the rapid reduction in payables days, which reduces working capital efficiency.