Eversource Energy (ES)
Cash conversion cycle
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 62.70 | 104.86 | 89.30 | 117.24 | 84.54 | 72.20 | 62.47 | 72.69 | 75.02 | 62.55 | 54.27 | 89.57 | 83.29 | 71.43 | 59.50 | 78.19 | 66.50 | 56.13 | 48.82 | 99.27 |
| Days of sales outstanding (DSO) | days | 43.87 | 42.63 | 38.38 | 48.04 | 45.06 | 45.19 | 44.83 | 51.01 | 45.37 | 48.92 | 46.90 | 50.33 | 49.02 | 46.60 | 42.52 | 43.83 | 42.35 | 42.60 | 40.90 | 48.53 |
| Number of days of payables | days | 231.01 | 386.28 | 341.09 | 504.58 | 477.32 | 327.06 | 322.22 | 378.44 | 468.99 | 371.13 | 306.79 | 308.43 | 429.85 | 407.34 | 321.66 | 249.52 | 324.13 | 245.44 | 253.28 | 360.65 |
| Cash conversion cycle | days | -124.45 | -238.79 | -213.41 | -339.30 | -347.72 | -209.66 | -214.92 | -254.74 | -348.59 | -259.65 | -205.62 | -168.52 | -297.53 | -289.31 | -219.64 | -127.50 | -215.28 | -146.71 | -163.56 | -212.85 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 62.70 + 43.87 – 231.01
= -124.45
The cash conversion cycle of Eversource Energy has demonstrated a fluctuating trend over the past eight quarters. The company's cash conversion cycle, which measures the time it takes for the company to convert its investment in inventory into cash received from customers, has shown improvements in efficiency in recent quarters.
In Q4 2023, the cash conversion cycle was calculated at -45.41 days, indicating that the company was able to convert its investments in inventory into cash more quickly compared to the previous quarters. This trend of improvement in efficiency is further supported by the Q3 and Q2 2023 figures of -31.23 days and -29.06 days, respectively, showing a continued decrease in the time taken to convert inventory into cash.
These improvements are in contrast to the preceding quarters, particularly Q4 2022, where the cash conversion cycle was at its longest at -74.47 days. The negative values in the cash conversion cycle indicate that the company is managing its working capital efficiently, turning inventory into cash quickly.
Overall, the recent performance of Eversource Energy in terms of its cash conversion cycle suggests an enhanced effectiveness in managing its inventory and accounts receivable, leading to quicker cash realization and potential improved liquidity position.
Peer comparison
Dec 31, 2023