Stock Analysis on Net

Cigna Group (NYSE:CI)

This company has been moved to the archive! The financial data has not been updated since February 27, 2025.

Analysis of Short-term (Operating) Activity Ratios 

Microsoft Excel

Short-term Activity Ratios (Summary)

Cigna Group, short-term (operating) activity ratios

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Turnover Ratios
Inventory turnover 27.27 23.70 26.13 31.58 32.70
Receivables turnover 15.60 17.06 18.64 19.35 19.47
Payables turnover 6.41 6.75 7.31 7.68 7.75
Working capital turnover
Average No. Days
Average inventory processing period 13 15 14 12 11
Add: Average receivable collection period 23 21 20 19 19
Operating cycle 36 36 34 31 30
Less: Average payables payment period 57 54 50 48 47
Cash conversion cycle -21 -18 -16 -17 -17

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Inventory Turnover
The inventory turnover ratio shows a declining trend from 32.7 in 2020 to 23.7 in 2023, indicating slower inventory turnover over this period. However, there is a slight recovery to 27.27 in 2024, suggesting some improvement in inventory management efficiency.
Receivables Turnover
Receivables turnover also exhibits a gradual decrease from 19.47 in 2020 to 15.6 in 2024, implying that the collection of receivables has become slower, potentially impacting liquidity and cash flow.
Payables Turnover
The payables turnover ratio declines steadily from 7.75 in 2020 to 6.41 in 2024. This decrease indicates that the company is taking longer to pay its suppliers, which could be a strategic move to conserve cash or a result of payment delays.
Average Inventory Processing Period
The average time to process inventory increased from 11 days in 2020 to a peak of 15 days in 2023, before improving somewhat to 13 days in 2024. This aligns with the earlier observation of slower inventory turnover, reflecting longer holding periods for inventory.
Average Receivable Collection Period
The receivable collection period has gradually lengthened from 19 days in 2020 to 23 days in 2024, confirming the trend of slower receivables turnover and indicating an elongation in cash inflows.
Operating Cycle
The operating cycle extends from 30 days in 2020 to 36 days in both 2023 and 2024, illustrating a lengthening of the total time to convert inventory and receivables into cash, which may affect working capital requirements.
Average Payables Payment Period
The average time taken to pay suppliers increased consistently from 47 days in 2020 to 57 days in 2024. This trend complements the declining payables turnover ratio and suggests that the company is stretching its payment terms or experiencing delays.
Cash Conversion Cycle
The cash conversion cycle remains negative throughout the period, trending from -17 days in 2020 and 2021 to -21 days in 2024. This negative cycle indicates that the company effectively finances its operations through delayed payments to suppliers, aligning the timing of outgoing cash flows with or beyond incoming cash flows, which helps maintain liquidity.
Summary
Overall, the data depicts a company experiencing slower turnover in inventory and receivables, as reflected by increasing days outstanding in both categories. Simultaneously, the company takes longer to settle payables, enhancing its cash position as shown by the negative and lengthening cash conversion cycle. This combination suggests a strategic extension in working capital components to optimize liquidity, though it may also reflect operational challenges in managing inventory and collections efficiently.

Turnover Ratios


Average No. Days


Inventory Turnover

Cigna Group, inventory turnover calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data (US$ in millions)
Pharmacy and other service costs 182,509 133,801 124,834 117,553 103,484
Inventories 6,692 5,645 4,777 3,722 3,165
Short-term Activity Ratio
Inventory turnover1 27.27 23.70 26.13 31.58 32.70
Benchmarks
Inventory Turnover, Competitors2
Abbott Laboratories 3.02 2.74 3.10 3.59 2.99
CVS Health Corp. 17.75 16.83 14.05 13.52 11.88
Intuitive Surgical Inc. 1.83 1.96 2.27 2.98 2.49
Medtronic PLC 2.15 2.03 2.20 2.43 2.23
Inventory Turnover, Sector
Health Care Equipment & Services 24.05 22.52 20.37 20.15 17.40
Inventory Turnover, Industry
Health Care 9.50 9.18 9.22 9.17 8.17

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 2024 Calculation
Inventory turnover = Pharmacy and other service costs ÷ Inventories
= 182,509 ÷ 6,692 = 27.27

2 Click competitor name to see calculations.

Pharmacy and other service costs
The pharmacy and other service costs exhibited a consistent upward trend over the five-year period. Starting at $103,484 million in 2020, these costs increased each year, reaching $182,509 million by 2024. This represents a substantial rise, particularly notable between 2023 and 2024, where the increase accelerated significantly compared to previous years, indicating either higher volume, increased pricing, or a combination of both factors.
Inventories
Inventory levels have also shown a steady increase from $3,165 million in 2020 to $6,692 million in 2024. The growth in inventories suggests a buildup of stock, which may reflect anticipation of higher demand, supply chain adjustments, or changes in inventory management strategies. The rate of increase appears relatively consistent year over year without abrupt fluctuations.
Inventory turnover
The inventory turnover ratio declined from 32.7 in 2020 to a low of 23.7 in 2023, indicating that inventories were being turned over less frequently. This declining trend reflects slower movement or higher stock levels relative to cost of goods sold. However, in 2024 there is a slight rebound to 27.27, suggesting an improvement in inventory efficiency or sales velocity relative to inventory holdings during that year.

Receivables Turnover

Cigna Group, receivables turnover calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data (US$ in millions)
Pharmacy revenues 185,362 137,243 128,566 121,413 107,769
Noninsurance customer receivables 11,879 8,044 6,899 6,274 5,534
Short-term Activity Ratio
Receivables turnover1 15.60 17.06 18.64 19.35 19.47
Benchmarks
Receivables Turnover, Competitors2
Abbott Laboratories 6.06 6.11 7.02 6.64 5.40
CVS Health Corp. 10.16 10.12 11.79 11.91 12.32
Elevance Health Inc. 18.00 18.08 18.81 20.66 19.72
Intuitive Surgical Inc. 6.82 6.30 6.60 7.30 6.75
Medtronic PLC 5.28 5.21 5.71 5.51 6.22
UnitedHealth Group Inc. 17.66 17.27 18.22 20.07 19.86
Receivables Turnover, Sector
Health Care Equipment & Services 12.24 12.11 13.26 13.54 13.48
Receivables Turnover, Industry
Health Care 8.42 8.15 8.84 8.65 8.64

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 2024 Calculation
Receivables turnover = Pharmacy revenues ÷ Noninsurance customer receivables
= 185,362 ÷ 11,879 = 15.60

2 Click competitor name to see calculations.

Pharmacy Revenues
The pharmacy revenues exhibit a consistent upward trend over the five-year period. Starting at US$107,769 million in 2020, revenues increased annually to reach US$185,362 million by the end of 2024. This represents a significant growth, particularly notable between 2023 and 2024 where the increase accelerated markedly.
Noninsurance Customer Receivables
Noninsurance customer receivables have also shown a steady rise, growing from US$5,534 million in 2020 to US$11,879 million in 2024. The increase is gradual until 2023, after which there is a sharper rise, indicating potentially higher credit extended to customers or slower collections in the most recent year.
Receivables Turnover Ratio
The receivables turnover ratio has declined consistently from 19.47 in 2020 to 15.6 in 2024. This downward trend suggests that the rate at which receivables are converted into cash is slowing over time. The decrease in turnover ratio aligns with the increase in receivables, implying longer collection periods or a larger proportion of sales on credit.

Payables Turnover

Cigna Group, payables turnover calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data (US$ in millions)
Pharmacy and other service costs 182,509 133,801 124,834 117,553 103,484
Pharmacy and other service costs payable 28,465 19,815 17,070 15,309 13,347
Short-term Activity Ratio
Payables turnover1 6.41 6.75 7.31 7.68 7.75
Benchmarks
Payables Turnover, Competitors2
Abbott Laboratories 4.46 4.19 4.15 4.21 3.80
CVS Health Corp. 20.22 20.36 18.07 19.14 19.72
Elevance Health Inc. 8.10 7.72 7.47 7.59 7.75
Intuitive Surgical Inc. 14.05 12.69 13.78 14.45 18.35
Medtronic PLC 4.65 4.03 4.46 4.98 4.72
UnitedHealth Group Inc. 7.72 7.47 7.26 7.63 7.29
Payables Turnover, Sector
Health Care Equipment & Services 10.26 9.93 9.42 9.80 9.78
Payables Turnover, Industry
Health Care 8.12 7.96 7.50 7.61 7.48

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 2024 Calculation
Payables turnover = Pharmacy and other service costs ÷ Pharmacy and other service costs payable
= 182,509 ÷ 28,465 = 6.41

2 Click competitor name to see calculations.

Pharmacy and other service costs
The data indicates a consistent upward trend in pharmacy and other service costs over the five-year period. Costs rose steadily from $103,484 million in 2020 to $133,801 million in 2023, followed by a more pronounced increase to $182,509 million in 2024. This sharp rise in the final year suggests a significant escalation in expenses related to pharmaceutical and related services.
Pharmacy and other service costs payable
The payable amount for pharmacy and other service costs also exhibits a continuous increase across the years. Starting at $13,347 million in 2020, the payables grew gradually to $19,815 million by the end of 2023. The increase becomes more substantial in 2024, reaching $28,465 million. This pattern reflects growing outstanding obligations in relation to pharmacy and other service expenses.
Payables turnover
The payables turnover ratio has declined every year during the period, moving from 7.75 in 2020 down to 6.41 in 2024. This decreasing trend indicates that the time taken to pay off pharmacy and other service costs payables has lengthened. The company is turning over its payables less frequently, which may reflect changes in payment practices, liquidity management, or negotiations with suppliers.

Working Capital Turnover

Cigna Group, working capital turnover calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data (US$ in millions)
Current assets 48,870 37,351 30,120 36,134 27,799
Less: Current liabilities 57,979 48,716 41,229 43,572 36,022
Working capital (9,109) (11,365) (11,109) (7,438) (8,223)
 
Pharmacy revenues 185,362 137,243 128,566 121,413 107,769
Short-term Activity Ratio
Working capital turnover1
Benchmarks
Working Capital Turnover, Competitors2
Abbott Laboratories 4.42 4.54 4.48 3.87 4.06
CVS Health Corp.
Elevance Health Inc. 7.85 7.83 8.37 7.23 6.39
Intuitive Surgical Inc. 1.56 1.14 1.29 1.22 0.77
Medtronic PLC 2.90 2.47 2.97 2.15 2.48
UnitedHealth Group Inc.
Working Capital Turnover, Sector
Health Care Equipment & Services 95.28 67.67 50.71 35.48 39.06
Working Capital Turnover, Industry
Health Care 19.80 16.59 15.34 11.93 11.78

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 2024 Calculation
Working capital turnover = Pharmacy revenues ÷ Working capital
= 185,362 ÷ -9,109 =

2 Click competitor name to see calculations.

Working Capital
The working capital values have been negative throughout the observed period, indicating a consistent scenario where current liabilities exceed current assets. The negative working capital increased from -8,223 million US dollars at the end of 2020 to -11,109 million US dollars by the end of 2022, signifying a deterioration in liquidity position over these two years. This negative trend continued slightly into 2023, reaching -11,365 million US dollars. However, there was an improvement by the end of 2024, with the working capital becoming less negative at -9,109 million US dollars. Despite this relative improvement, the working capital remains substantially negative, which could imply potential liquidity pressures or strategic management of current liabilities.
Pharmacy Revenues
Pharmacy revenues demonstrated a consistent upward trend across the five-year period. Starting at 107,769 million US dollars in 2020, revenues increased annually to reach 121,413 million in 2021 and 128,566 million in 2022, showing steady growth. This positive trajectory continued in 2023 with revenues rising to 137,243 million US dollars. The most notable increase occurred by the end of 2024, where pharmacy revenues surged significantly to 185,362 million US dollars. This substantial rise may reflect an expansion in sales volume, pricing strategy adjustments, or market growth. Overall, pharmacy revenues show robust growth, indicating strong operational performance in this segment.
Working Capital Turnover
The working capital turnover ratio data is missing for all reported periods, thus no analysis or trend assessment can be conducted for this metric.

Average Inventory Processing Period

Cigna Group, average inventory processing period calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data
Inventory turnover 27.27 23.70 26.13 31.58 32.70
Short-term Activity Ratio (no. days)
Average inventory processing period1 13 15 14 12 11
Benchmarks (no. days)
Average Inventory Processing Period, Competitors2
Abbott Laboratories 121 133 118 102 122
CVS Health Corp. 21 22 26 27 31
Intuitive Surgical Inc. 200 186 161 122 147
Medtronic PLC 170 180 166 150 164
Average Inventory Processing Period, Sector
Health Care Equipment & Services 15 16 18 18 21
Average Inventory Processing Period, Industry
Health Care 38 40 40 40 45

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 2024 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 27.27 = 13

2 Click competitor name to see calculations.

Inventory Turnover
The inventory turnover ratio demonstrates a declining trend from 32.7 in 2020 to 23.7 in 2023, indicating a slowing rate at which inventory was sold and replaced. However, in 2024, there is a noticeable recovery to 27.27, suggesting an improvement in inventory management or sales velocity after several years of decline.
Average Inventory Processing Period
This metric shows an overall increase from 11 days in 2020 to a peak of 15 days in 2023, reflecting a lengthening of the time inventory is held before sale. In 2024, the processing period decreases back to 13 days, aligning with the partial recovery observed in inventory turnover. This inverse relationship between inventory turnover and processing period is consistent with operational efficiency trends.
Summary
The data reveals a period of decreased efficiency in inventory management over the four years leading to 2023, as shown by reducing turnover ratios and increasing processing periods. The reversal in 2024 indicates a strategic or operational adjustment leading to improved inventory use and potentially better sales or supply chain management. Continuous monitoring of these metrics will be crucial to ascertain whether the improvement trend continues.

Average Receivable Collection Period

Cigna Group, average receivable collection period calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data
Receivables turnover 15.60 17.06 18.64 19.35 19.47
Short-term Activity Ratio (no. days)
Average receivable collection period1 23 21 20 19 19
Benchmarks (no. days)
Average Receivable Collection Period, Competitors2
Abbott Laboratories 60 60 52 55 68
CVS Health Corp. 36 36 31 31 30
Elevance Health Inc. 20 20 19 18 19
Intuitive Surgical Inc. 54 58 55 50 54
Medtronic PLC 69 70 64 66 59
UnitedHealth Group Inc. 21 21 20 18 18
Average Receivable Collection Period, Sector
Health Care Equipment & Services 30 30 28 27 27
Average Receivable Collection Period, Industry
Health Care 43 45 41 42 42

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 2024 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 15.60 = 23

2 Click competitor name to see calculations.

The financial data shows a clear trend in the receivables turnover ratio and the average receivable collection period over the five-year span from 2020 to 2024.

Receivables Turnover Ratio
The receivables turnover ratio exhibits a consistent decline from 19.47 in 2020 to 15.6 in 2024. This downward trend indicates a slowing pace at which receivables are being collected relative to credit sales. A decreasing turnover ratio may suggest that the company is taking longer to collect outstanding receivables, which could potentially impact cash flow efficiency.
Average Receivable Collection Period
The average collection period, measured in days, correspondingly increases from 19 days in 2020 to 23 days in 2024. This upward trend aligns with the decreasing turnover ratio, confirming that on average, receivables are being collected more slowly over time. The gradual increase in the collection period may signal potential challenges in credit management or customer payment behavior.

Overall, the data imply a gradual deterioration in the efficiency of receivables collection. This warrants attention to credit policies and collection processes to prevent potential impacts on the company's liquidity position.


Operating Cycle

Cigna Group, operating cycle calculation, comparison to benchmarks

No. days

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data
Average inventory processing period 13 15 14 12 11
Average receivable collection period 23 21 20 19 19
Short-term Activity Ratio
Operating cycle1 36 36 34 31 30
Benchmarks
Operating Cycle, Competitors2
Abbott Laboratories 181 193 170 157 190
CVS Health Corp. 57 58 57 58 61
Intuitive Surgical Inc. 254 244 216 172 201
Medtronic PLC 239 250 230 216 223
Operating Cycle, Sector
Health Care Equipment & Services 45 46 46 45 48
Operating Cycle, Industry
Health Care 81 85 81 82 87

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 2024 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 13 + 23 = 36

2 Click competitor name to see calculations.

The analysis of the annual financial data reveals several noteworthy trends concerning the company's operational efficiency over the five-year period from 2020 to 2024.

Average Inventory Processing Period
This metric experienced a gradual increase from 11 days in 2020 to a peak of 15 days in 2023, indicating a lengthening of the time taken to process inventory. However, in 2024, the period decreased to 13 days, suggesting some improvement or stabilization after the prior upward trend.
Average Receivable Collection Period
The receivable collection period remained steady at 19 days during 2020 and 2021. From 2022 onwards, it showed a consistent upward trajectory, increasing to 20 days in 2022, 21 days in 2023, and reaching 23 days by 2024. This progression signals a trend toward longer durations to collect receivables, which could indicate challenges in cash collection or changing credit terms.
Operating Cycle
The operating cycle, representing the total days to convert inventory and receivables into cash, followed a rising pattern overall. It increased from 30 days in 2020 to 36 days in 2023 and remained at 36 days in 2024. This suggests a lengthening operating cycle, potentially reflecting slower cash conversion and less efficient working capital management.

In summary, the data indicate that both the inventory processing period and receivable collection period have generally extended over the examined years, contributing to a longer operating cycle. The slight improvement in inventory processing time in the final year may be a positive sign, but the consistent increase in receivable collection time merits attention. These patterns could affect liquidity and operational efficiency if not addressed strategically.


Average Payables Payment Period

Cigna Group, average payables payment period calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data
Payables turnover 6.41 6.75 7.31 7.68 7.75
Short-term Activity Ratio (no. days)
Average payables payment period1 57 54 50 48 47
Benchmarks (no. days)
Average Payables Payment Period, Competitors2
Abbott Laboratories 82 87 88 87 96
CVS Health Corp. 18 18 20 19 19
Elevance Health Inc. 45 47 49 48 47
Intuitive Surgical Inc. 26 29 26 25 20
Medtronic PLC 78 91 82 73 77
UnitedHealth Group Inc. 47 49 50 48 50
Average Payables Payment Period, Sector
Health Care Equipment & Services 36 37 39 37 37
Average Payables Payment Period, Industry
Health Care 45 46 49 48 49

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 2024 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 6.41 = 57

2 Click competitor name to see calculations.

Payables Turnover Ratio
The payables turnover ratio shows a clear declining trend over the five-year period. Starting at 7.75 in 2020, it gradually decreased each year to reach 6.41 by 2024. This consistent decrease indicates that the frequency with which the company settles its payables is reducing, implying a slower payment cycle to suppliers or creditors over time.
Average Payables Payment Period
In contrast to the payables turnover ratio, the average payables payment period has been increasing throughout the same timeframe. Beginning at 47 days in 2020, it rises steadily each year, reaching 57 days by 2024. This increase suggests that the company is taking progressively longer to pay its obligations, extending the duration between purchase and payment.
Overall Insights
The inverse relationship between the payables turnover ratio and the average payment period reflects a strategic shift or operational change leading to longer payment terms or delayed payments. Such a pattern could indicate improved cash flow management by extending payment cycles or potential liquidity constraints impacting payment speed. The steady progression of these trends reflects consistency in this approach or circumstance without significant volatility.

Cash Conversion Cycle

Cigna Group, cash conversion cycle calculation, comparison to benchmarks

No. days

Microsoft Excel
Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Selected Financial Data
Average inventory processing period 13 15 14 12 11
Average receivable collection period 23 21 20 19 19
Average payables payment period 57 54 50 48 47
Short-term Activity Ratio
Cash conversion cycle1 -21 -18 -16 -17 -17
Benchmarks
Cash Conversion Cycle, Competitors2
Abbott Laboratories 99 106 82 70 94
CVS Health Corp. 39 40 37 39 42
Intuitive Surgical Inc. 228 215 190 147 181
Medtronic PLC 161 159 148 143 146
Cash Conversion Cycle, Sector
Health Care Equipment & Services 9 9 7 8 11
Cash Conversion Cycle, Industry
Health Care 36 39 32 34 38

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

1 2024 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 13 + 2357 = -21

2 Click competitor name to see calculations.

Average Inventory Processing Period
The average inventory processing period exhibits a gradual increase from 11 days in 2020 to a peak of 15 days in 2023, followed by a slight decrease to 13 days in 2024. This suggests initial challenges in inventory turnover or operational adjustments that slightly improved by the latest period.
Average Receivable Collection Period
The average receivable collection period shows a steady upward trend, rising from 19 days in 2020 to 23 days in 2024. This increase indicates that the company is taking longer to collect payments from customers, which could impact cash flow management and working capital efficiency.
Average Payables Payment Period
The average payables payment period has lengthened consistently, increasing from 47 days in 2020 to 57 days in 2024. This growing payment duration suggests the company is extending the time taken to pay suppliers, potentially as a strategy to conserve cash or manage liquidity.
Cash Conversion Cycle
The cash conversion cycle remains negative throughout the period, fluctuating slightly but showing an improvement from -17 days in 2020 and 2021 to -21 days in 2024. A negative cash conversion cycle indicates the company receives cash from sales before it needs to pay its suppliers, which is a favorable liquidity indicator. The trend towards a more negative cycle implies enhanced efficiency in managing working capital over time.