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.