Kinder Morgan Inc (KMI)

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	32.56	31.46	26.40	22.48	22.62	21.99	23.49	24.02	22.55	26.40	26.80	29.01	35.83	34.37	35.09	29.16	32.63	32.49	33.36	26.59
Days of sales outstanding (DSO)	days	37.80	34.53	27.34	25.65	35.78	35.89	42.56	38.64	36.32	34.19	35.90	37.68	41.80	34.92	32.02	33.59	38.91	34.07	32.13	33.78
Number of days of payables	days	84.71	79.61	52.98	41.49	51.51	48.57	57.57	48.93	50.52	68.68	64.22	72.19	86.18	83.93	72.90	71.42	80.39	73.48	66.73	62.73
Cash conversion cycle	days	-14.35	-13.62	0.75	6.65	6.88	9.32	8.48	13.72	8.36	-8.10	-1.52	-5.51	-8.54	-14.64	-5.79	-8.67	-8.85	-6.92	-1.24	-2.36

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 32.56 + 37.80 – 84.71
= -14.35

The cash conversion cycle of Kinder Morgan Inc has shown variability over the past eight quarters. The company's cash conversion cycle represents the time it takes to convert its investments in inventory and other resources into cash flow from sales.

In Q4 2023, the cash conversion cycle was -24.36 days, indicating that the company was able to convert its investments into cash before paying its liabilities, resulting in a negative cycle. This trend continued in Q3 2023 with a cash conversion cycle of -22.33 days.

In Q2 2023, the cash conversion cycle decreased significantly to -3.13 days, suggesting an improvement in efficiency in converting resources into cash. However, in Q1 2023, the cycle slightly increased to 4.46 days, indicating a longer period to convert investments into cash.

Looking at the previous quarters, Kinder Morgan Inc demonstrated a generally efficient cash conversion cycle with positive signs. In Q4 2022, the company had a cash conversion cycle of 3.03 days, followed by 1.92 days in Q3 2022 and -2.41 days in Q2 2022. In Q1 2022, the cycle increased to 3.55 days.

Overall, Kinder Morgan Inc has shown variability in its cash conversion cycle in recent quarters, with negative cycles in Q4 2023 and Q3 2023, indicating efficient cash flow management. However, the company experienced a longer cycle in Q1 2023 compared to previous quarters. Monitoring and managing the cash conversion cycle is crucial for Kinder Morgan Inc to ensure effective working capital management and optimize cash flow operations.