Hess Corporation (HES)
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 | 170.71 | 127.96 | 186.26 | 53.33 | 161.47 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | 225.74 | 168.05 | 183.75 | 28.22 | 254.26 |
| Cash conversion cycle | days | -55.03 | -40.10 | 2.51 | 25.11 | -92.80 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 170.71 + — – 225.74
= -55.03
The cash conversion cycle for Hess Corporation has shown fluctuations over the past five years. In 2023, the company's cash conversion cycle was 46.18 days, indicating an improvement from the previous year when it was 37.45 days. This suggests that in 2023, Hess Corporation took slightly longer to convert its investments in raw materials into cash received from sales.
Compared to 2021 and 2020, where the cash conversion cycle was 59.15 days and 67.26 days, respectively, there has been a noticeable improvement in the efficiency of managing cash flows in 2023. However, it is important to note that the company's performance in 2023 is still higher than in 2019 when the cash conversion cycle was at 65.75 days.
Overall, while there has been some variability in the cash conversion cycle for Hess Corporation in recent years, the company's ability to efficiently convert investments in inventory and receivables into cash has shown improvement in 2023 compared to the prior year. Further analysis and monitoring will be necessary to assess the company's cash flow management performance in the future.
Peer comparison
Dec 31, 2023