Strategy

2001 Working Capital Survey – Chart 1

AEROSPACE
CFO StaffJuly 1, 2001

Behind the Rankings

The management of working capital combines two measures, weighted equally:
1. Days of Working Capital (DWC) = (Receivables + Inventory ­ Payables) ÷ (Sales ÷ 365 Days). If payables exceed the sum of receivables and inventory, DWC is negative.
2. Cash Conversion Efficiency (CCE) = Cash Flow from Operations ÷ Sales.

The overall ranking: (Highest Overall CCE ­ Company CCE) ÷ (Highest Overall CCE ­ Lowest Overall CCE) + (Lowest Overall DWC ­ Company DWC) ÷ (Lowest Overall DWC ­ Highest Overall DWC). Days of Sales Outstanding (DSO), Inventory Turns, and Days of Payables Outstanding (DPO) are not part of the overall ranking criteria. Industry averages consider all companies in an industry, not just the top five.

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Sources: REL Consultancy Group, Piranha Web


Back to “Forget the Float? — The 2001 Working Capital Survey”

AEROSPACE
Overall Rank Company Name Prior Year Sales Cash Conver. Effic. Days Working Cap. Days Sales Outst. Inven. Turns Days Payable Outst.
CCE Rk. DWC Rk. DSO Rk. Ts. Rk. DPO Rk.
176 BOEING $51,321 9% 454 (2) 39 26 211 7 470 76 37
451 AMETEK $1,025 10% 375 61 549 50 525 7 458 29 476
478 RAY- THEON $16,895 3% 790 24 210 14 114 7 457 31 410
556 TELE- DYNE TECH. $795 7% 598 56 508 53 572 10 310 23 666
583 ALLIANT TECH- SYS. $1,078 8% 533 66 593 77 855 18 164 28 498
626 GENCORP $1,047 10% 410 85 751 51 540 7 467 15 892
692 NOR- THROP GRUM- MAN $7,618 11% 347 99 839 72 823 6 523 24 650
724 HEXCEL $1,056 8% 525 87 775 55 609 5 623 26 582
770 PRE- CISION CAST- PARTS $1,674 9% 428 105 862 64 736 4 732 28 520
826 LITTON IND. $5,588 5% 702 88 777 62 707 6 550 25 614
915 SEQUA $1,773 2% 860 97 828 60 672 5 681 28 495
921 BE AERO- SPACE $723 2% 848 103 851 64 725 4 791 33 369
948 AAR $1,024 2% 846 119 907 60 671 3 879 45 179
958 KAMAN $1,031 1% 898 123 921 70 800 4 787 19 810
966 ORBITAL SCI- ENCES $875 0% 943 121 913 117 980 10 307 26 562
983 MOOG INC $644 6% 641 187 988 122 984 3 871 20 790
989 FAIR- CHILD CORP $635 -6% 994 142 949 70 803 3 907 35 323
739 Industry Average $5,577 5%   92   64   6   30

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