UNITIL Corporation (UTL)

Short-term

Turnover ratios

Unitil Corp.'s activity ratios provide insights into the efficiency of its operations in managing inventory, receivables, payables, and working capital.

1. Inventory Turnover:
- Unitil Corp.'s inventory turnover has decreased over the years, from 25.66 in 2019 to 20.59 in 2023. This indicates that the company is selling its inventory less frequently.
- A lower inventory turnover may suggest overstocking or slow-moving inventory, which could tie up capital and lead to potential obsolescence risks.

2. Receivables Turnover:
- The receivables turnover has shown a fluctuating trend, with a peak of 6.6 in 2023. This indicates the number of times the company collects its accounts receivable during a year.
- An increasing receivables turnover can suggest that Unitil Corp. is efficient in collecting payments from its customers, improving its cash flow.

3. Payables Turnover:
- The payables turnover has been inconsistent but generally within a stable range. The increasing trend from 2018 to 2020 followed by a decrease in 2021 and 2022 can signify changes in payment practices with suppliers.
- A higher payables turnover may indicate that Unitil Corp. is taking longer to pay its suppliers, potentially indicating better cash flow management but possibly straining supplier relationships.

4. Working Capital Turnover:
- The data for working capital turnover is not available for the years provided. This ratio would typically measure how efficiently the company is using its working capital to generate sales.
- Absence of data may limit a comprehensive analysis of Unitil Corp.'s ability to optimize its working capital to support its operations and growth.

In conclusion, Unitil Corp. should closely monitor its inventory management to avoid overstocking, while aiming to maintain a balance between efficient receivables collection and timely payables management. Additionally, tracking working capital turnover could provide a more holistic view of the company's operational efficiency.

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Average number of days

Unitil Corp.'s activity ratios provide insight into the company's efficiency in managing its inventory, collecting receivables, and paying its suppliers.

1. Days of Inventory on Hand (DOH):
- In 2023, the company took, on average, approximately 17.73 days to sell its inventory, which increased from 15.03 days in 2022. This could suggest that Unitil Corp. may be holding more inventory than necessary or facing challenges in selling its products efficiently.

2. Days of Sales Outstanding (DSO):
- The DSO ratio indicates that in 2023, Unitil Corp. took around 55.30 days to collect its accounts receivable, which is an improvement from 63.58 days in 2022. This shows an enhanced ability to collect receivables promptly, potentially improving the company's cash flow and liquidity position.

3. Number of Days of Payables:
- The company took approximately 58.33 days to pay its suppliers in 2023. This ratio decreased from 78.12 days in 2022, indicating that Unitil Corp. is managing its payables more efficiently. A lower number of days of payables can indicate better supplier relationships and potential negotiation power.

Overall, Unitil Corp.'s activity ratios reveal a mixed performance in inventory management, accounts receivable collection, and accounts payable. Improvements in DSO and payables management are positive signs, but the increase in DOH warrants monitoring to ensure optimal inventory levels and sales efficiency.

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Long-term

Unitil Corp.'s long-term activity ratios, specifically the fixed asset turnover and total asset turnover, provide insights into how efficiently the company is utilizing its assets to generate sales.

Fixed asset turnover measures how effectively the company is utilizing its fixed assets to generate revenue. Unitil Corp.'s fixed asset turnover has shown a slight decrease from 0.42 in 2022 to 0.39 in 2023. This indicates that the company is generating $0.39 in sales for every $1 invested in fixed assets. Although there has been a decrease, the company is still effectively utilizing its fixed assets to generate revenue.

Total asset turnover, on the other hand, measures the company's ability to use all assets to generate sales. Unitil Corp.'s total asset turnover has shown a consistent upward trend from 0.28 in 2020 to 0.33 in 2023. This indicates that the company is generating $0.33 in sales for every $1 of total assets. The increasing trend suggests that the company is becoming more efficient in generating sales using all its assets.

Overall, based on the long-term activity ratios, Unitil Corp. appears to be improving its efficiency in utilizing both fixed and total assets to generate sales over the years.