Evergy Inc. Common Stock (EVRG)

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	181.66	176.62	154.84	142.01	138.43
Days of sales outstanding (DSO)	days	29.01	32.74	26.81	38.24	16.20
Number of days of payables	days	144.38	157.70	174.78	184.09	152.00
Cash conversion cycle	days	66.29	51.66	6.86	-3.85	2.63

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 181.66 + 29.01 – 144.38
= 66.29

The cash conversion cycle of Evergy Inc has fluctuated over the past five years. In 2023, the company's cash conversion cycle increased to 56.68 days from 34.67 days in 2022. This indicates that it took Evergy Inc longer to convert its investments in inventory and accounts receivable into cash in 2023 compared to the previous year.

The negative cash conversion cycle in 2021 (-0.81 days) suggests that Evergy Inc was able to generate cash from its operations before paying its suppliers and other short-term obligations. This efficient cycle means that the company was able to quickly convert its inventory and accounts receivable into cash, potentially indicating strong working capital management.

In 2020, the cash conversion cycle was negative again at -24.63 days, demonstrating the company's ability to efficiently manage its working capital and convert its resources into cash quickly.

In 2019, the cash conversion cycle was positive at 8.64 days, indicating a slightly longer time for Evergy Inc to convert its investments into cash compared to the negative cycles in the subsequent years.

Overall, fluctuations in Evergy Inc's cash conversion cycle suggest varying levels of efficiency in managing working capital over the years, with negative cycles indicating strong performance in converting investments into cash.