CMS Energy Corporation (CMS)

Days of sales outstanding (DSO)

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Receivables turnover		13.40	20.26	17.51	16.38	15.78	26.41	26.09	5.79	3.83	5.41	5.79	4.98	5.13	6.56	6.07	4.39	4.03	6.89	6.39	5.73
DSO	days	27.25	18.02	20.85	22.29	23.14	13.82	13.99	63.04	95.24	67.48	63.05	73.24	71.17	55.61	60.18	83.09	90.65	52.95	57.11	63.71

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 13.40
= 27.25

DSO (Days Sales Outstanding) is a key financial ratio that measures the average number of days it takes for a company to collect payment after making a sale. For CMS Energy Corporation, analyzing the trend in DSO over the provided time period reveals fluctuations in the efficiency of its accounts receivable management.

From March 31, 2020, to September 30, 2021, CMS Energy Corporation successfully reduced its DSO from 63.71 days to 55.61 days, indicating an improvement in its collection process and liquidity. However, there was a significant increase in DSO to 95.24 days by December 31, 2022, suggesting potential challenges in collecting payments efficiently.

Subsequently, CMS Energy Corporation managed to bring down its DSO to as low as 13.82 days by September 30, 2023, and maintained relatively low levels through December 31, 2024. This signifies a positive trend in managing accounts receivable and improving cash flow.

While occasional fluctuations in DSO are common due to various factors impacting sales and collections, it is essential for CMS Energy Corporation to monitor this ratio closely to ensure timely receivables collection and maintain healthy liquidity levels.