Foster Wheeler AG (FRA:FWI) Cash Conversion Cycle : 35.84 (As of Sep. 2014)

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What is Foster Wheeler AG Cash Conversion Cycle?

Cash Conversion Cycle is one of several measures of management effectiveness. It equals Days Sales Outstanding + Days Inventory - Days Payable.

Foster Wheeler AG's Days Sales Outstanding for the three months ended in Sep. 2014 was 67.59.
Foster Wheeler AG's Days Inventory for the three months ended in Sep. 2014 was 0.
Foster Wheeler AG's Days Payable for the three months ended in Sep. 2014 was 31.75.
Therefore, Foster Wheeler AG's Cash Conversion Cycle (CCC) for the three months ended in Sep. 2014 was 35.84.

Foster Wheeler AG Cash Conversion Cycle Historical Data

The historical data trend for Foster Wheeler AG's Cash Conversion Cycle can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Foster Wheeler AG Cash Conversion Cycle Chart

Foster Wheeler AG Annual Data

Trend

Dec04

Dec05

Dec06

Dec07

Dec08

Dec09

Dec10

Dec11

Dec12

Dec13

Cash Conversion Cycle

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13.09

20.28

18.19

20.01

32.73

Foster Wheeler AG Quarterly Data
	Dec09	Mar10	Jun10	Sep10	Dec10	Mar11	Jun11	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14	Jun14	Sep14
Cash Conversion Cycle	Get a 7-Day Free Trial															30.44	34.06	47.28	41.27	35.84

Competitive Comparison of Foster Wheeler AG's Cash Conversion Cycle

For the Engineering & Construction subindustry, Foster Wheeler AG's Cash Conversion Cycle, along with its competitors' market caps and Cash Conversion Cycle data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Foster Wheeler AG's Cash Conversion Cycle Distribution in the Construction Industry

For the Construction industry and Industrials sector, Foster Wheeler AG's Cash Conversion Cycle distribution charts can be found below:

* The bar in red indicates where Foster Wheeler AG's Cash Conversion Cycle falls into.

Foster Wheeler AG Cash Conversion Cycle Calculation

Cash Conversion Cycle (CCC) measures how fast a company can convert cash on hand into even more cash on hand. This metric looks at the amount of time needed to sell inventory, the amount of time needed to collect receivables and the length of time the company is afforded to pay its bills without incurring penalties.

Cash Conversion Cycle is one of several measures of management effectiveness.

Foster Wheeler AG's Cash Conversion Cycle for the fiscal year that ended in Dec. 2013 is calculated as

Cash Conversion Cycle	=	Days Sales Outstanding	+	Days Inventory	-	Days Payable
	=	72.18	+	0	-	39.45
	=	32.73

Foster Wheeler AG's Cash Conversion Cycle for the quarter that ended in Sep. 2014 is calculated as:

Cash Conversion Cycle	=	Days Sales Outstanding	+	Days Inventory	-	Days Payable
	=	67.59	+	0	-	31.75
	=	35.84

Foster Wheeler AG (FRA:FWI) Cash Conversion Cycle Explanation

Generally, the lower this number is, the better for the company. Although it should be combined with other metrics (such as ROE % and ROA %), it can be especially useful for comparing close competitors, because the company with the lowest CCC is often the one with better management.

Be Aware

CCC is most effective with retail-type companies, which have inventories that are sold to customers. Consulting businesses, software companies and insurance companies are all examples of companies for whom this metric is meaningless.

The CCC is one of several tools that can help you evaluate management, especially if it is calculated for several consecutive time periods and for several competitors. Decreasing or steady CCCs are good, while rising ones should motivate you to dig a bit deeper.

Foster Wheeler AG Cash Conversion Cycle Related Terms

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Foster Wheeler AG (FRA:FWI) Business Description

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Address

Website

http://www.fwc.com

Foster Wheeler AG was formed in 1927. The Company, with its subsidiaries, is a provider of construction and engineering services. The Company serves the oil and gas, oil refining, chemical and petrochemical, environmental, power generation, and power plant operation and maintenance industries. The Company operates through two business groups: its Global Engineering and Construction Group (Global E&C Group) and its Global Power Group. The Global E&C Group operates and designs, engineers, and constructs onshore and offshore upstream oil and gas processing facilities, natural gas liquefaction facilities and receiving terminals, gas-to-liquids facilities, oil refining, pharmaceutical and biotechnology facilities and related infrastructure, power generation and distribution facilities, and gasification facilities. The group provides engineering, project management and construction management services, and also designs facilities in new or developing market sectors, such as carbon capture and storage, solid fuel-fired integrated gasification combined-cycle power plants, coal-to-liquids, coal-to-chemicals and biofuels. The Global E&C Group additionally performs environmental remediation services. The Global Power Group designs, manufactures and installs steam generators and auxiliary equipment for electric power generating stations, district heating and power plants and industrial facilities. It offers new and retrofit nitrogen-oxide reduction systems, and provides site services related to these products, including construction and erection, maintenance engineering, plant upgrading, and life extensions. The Global Power Group conducts research and development in the areas of combustion, solid, fluid, and gas dynamics, heat transfer, materials, and solid mechanics. Further, this group owns and operates independent power production and waste-to-energy facilities, as well as power generation facilities for the process and petrochemical industries. Companies that compete with Global E&C Group include but are not limited to the following: Bechtel Corporation; Chicago Bridge & Iron Company N.V.; Chiyoda Corporation; Fluor Corporation; Jacobs Engineering Group Inc.; JGC Corporation; KBR, Inc.; Saipem S.p.A.; Technip; TÃ©cnicas Reunidas, SA; and WorleyParsons Ltd. Companies that compete with Global Power Group include but are not limited to the following: Alstom Power S.A.; Andritz Group AG; The Babcock & Wilcox Company; Babcock Power Inc.; Dongfang Boiler Works (a subsidiary of Dong Fang Electric Corporation); Doosan-Babcock; Harbin Boiler Co., Ltd.; Hitachi, Ltd.; Metso Corporation; Mitsubishi Heavy Industries Ltd.; and Shanghai Boiler Works Ltd. The operations are subject to certain federal, state and local environmental, occupational health and product safety laws.

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