CFO just published the 2015 working capital survey by REL Consulting. The 967 large U.S. companies included in the survey had $1.0541 trillion
in excess working capital. However, low interest rates appear to have
led to a level of apathy in working capital management as very little
improvement has been seen in the past year. Overall, the companies in
the survey have increased total debt by 62 percent since 2007, and the
cash balance at these same companies reached $932 billion, a 74 percent
increase since 2007. Even with cheap debt, days' sales outstanding
increased by one day, from 37.4 days to 36.4 days, although much of this
was a one-time improvement in the gas and oil industry.
The best performer in the cash conversion cycle was Anadarko Petroleum with a negative
346 days due to a paypables period of 397 days! Some of the other top
performers in the cash conversion cycle were Deere (negative 29 days),
Southwest Air (negative 17 days),
Intuit (negative 81 days), and SunEdison (negative 52 days). On the
other end of the performance scale, some of the longest cash conversion
cycles were at Toll Brothers (770 days), Boeing (202 days). FLIR systems (207 days), and Tiffany (494 days).
