UNITIL Corporation (UTL)

Cash conversion cycle

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Days of inventory on hand (DOH)	days	17.38	13.17	10.56	10.08	3,878.12
Days of sales outstanding (DSO)	days	31.16	28.54	30.51	29.50	30.12
Number of days of payables	days	60.83	46.54	63.52	61.40	15,147.50
Cash conversion cycle	days	-12.29	-4.83	-22.45	-21.83	-11,239.26

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 17.38 + 31.16 – 60.83
= -12.29

The cash conversion cycle for UNITIL Corporation has shown fluctuations over the past five years. In 2020, the company had a negative cash conversion cycle of -11,239.26 days, indicating an extremely efficient management of cash flow from operations, through inventory, and to accounts receivable. However, this metric improved significantly in 2021 to -21.83 days, showing a further reduction in the time it takes to convert resources into cash.

In 2022 and 2023, the cash conversion cycle remained relatively stable with values of -22.45 days and -4.83 days, respectively. This suggests that UNITIL continued to effectively manage its working capital during these years. However, in 2024, there was a slight increase in the cash conversion cycle to -12.29 days, indicating a longer cycle compared to the previous years.

Overall, UNITIL Corporation has demonstrated strong efficiency in managing its cash conversion cycle over the five-year period, despite some minor fluctuations. The company's ability to efficiently convert resources into cash and manage working capital suggests sound financial management practices.