Mideast firms need to improve working capital performance: study

Mideast firms need to improve working capital performance: study

Middle East companies need to act now and improve working capital performance in order to fare better on the road to recovery, says PwC (PricewaterhouseCoopers) in a study.PwC in its latest Middle East Working Capital Study finds that average working capital efficiency in the Middle East deteriorated slightly between the end of 2018 and 2019 to 127.6 days, the lowest performance in the past five years.Net Working Capital (NWC) days deteriorated between 2015 and 2019 by a compound rate of 2.7%, corresponding to around $9.94 billion (AED36.5 billion) of additional cash tied up in operations by listed companies across the region. In the first half of 2020 the average working capital performance deteriorated further during Covid-19 lockdowns to 156.7 days, as weaker credit policy controls slowed the rate of collections and