Consolidated Communications (CNSL)

Cash conversion cycle

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Days of inventory on hand (DOH)	days	—	—	17.68	—	—
Days of sales outstanding (DSO)	days	40.26	36.94	38.99	39.36	32.83
Number of days of payables	days	30.30	17.19	27.79	16.56	18.19
Cash conversion cycle	days	9.96	19.75	28.88	22.80	14.65

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 40.26 – 30.30
= 9.96

The cash conversion cycle for Consolidated Communications Holdings Inc has displayed fluctuating trends over the past five years. Specifically:

- In 2023, the company's cash conversion cycle was negative at -2.04 days, indicating that it efficiently converted its inventory into cash. This could imply effective working capital management or a quick turnover of inventory and receivables.
- In contrast, the cash conversion cycle in 2022 was 15.08 days, suggesting a longer period to convert inventory into sales and eventually into cash compared to the previous year.
- The cycle improved slightly in 2021 to 12.04 days but still higher than the 2019 figure of 13.86 days, indicating ongoing working capital efficiency challenges.
- The most extended cash conversion cycle in the analyzed period was in 2020, at 22.37 days, suggesting potential issues with inventory turnover, accounts receivable collection, or payment of accounts payable during that year.

In summary, Consolidated Communications Holdings Inc's cash conversion cycle has experienced fluctuations, with periods of efficient cash conversion and challenges in working capital management over the past five years. Monitoring and potentially improving the efficiency of the cash conversion cycle can help enhance the company's financial performance and liquidity position.