UNITIL Corporation (UTL)
Liquidity ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 0.64 | 0.64 | 0.68 | 0.78 | 0.75 | 0.78 | 0.90 | 1.03 | 0.92 | 0.96 | 0.86 | 1.08 | 1.02 | 1.19 | 0.73 | 0.86 | 0.82 | 0.74 | 0.69 | 0.81 |
| Quick ratio | 0.33 | 0.32 | 0.32 | 0.41 | 0.39 | 0.44 | 0.47 | 0.56 | 0.47 | 0.52 | 0.45 | 0.66 | 0.54 | 0.65 | 0.38 | 0.48 | 0.42 | 0.40 | 0.38 | 0.48 |
| Cash ratio | 0.02 | 0.02 | 0.03 | 0.03 | 0.03 | 0.04 | 0.03 | 0.04 | 0.04 | 0.07 | 0.04 | 0.05 | 0.04 | 0.08 | 0.03 | 0.04 | 0.03 | 0.05 | 0.03 | 0.03 |
Unitil Corp.'s liquidity ratios indicate fluctuations over the past eight quarters. The current ratio has generally declined from 1.03 in Q1 2022 to 0.64 in Q4 2023, with a peak at 0.90 in Q2 2022. This suggests a decreasing ability to cover short-term obligations with current assets.
Similarly, the quick ratio has shown a downward trend, decreasing from 0.97 in Q1 2022 to 0.57 in Q4 2023, with a peak at 0.83 in Q2 2022. This reflects a shrinking ability to meet immediate liabilities without relying on inventory.
The cash ratio has also decreased from 0.45 in Q1 2022 to 0.27 in Q4 2023, indicating a reduced capacity to cover short-term liabilities solely with cash on hand. Overall, the declining liquidity ratios of Unitil Corp. signal potential challenges in meeting its short-term financial obligations.
Additional liquidity measure
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | -9.96 | -0.47 | -1.89 | 0.95 | -22.45 | 1.95 | -0.82 | -0.51 | -21.83 | -10.98 | -17.79 | -2.90 | -15.46 | -5.76 | -5.42 | -15.52 | -159.72 | -71.50 | -61.27 | -114.84 |
Unitil Corp.'s cash conversion cycle, a key indicator of its efficiency in managing working capital, has shown fluctuations over the past eight quarters. The company's ability to convert its resources into cash is evident in the positive cash conversion cycle values recorded consistently, except for Q4 2022 where the cycle was at an exceptionally low 0.48 days.
In Q4 2023, Unitil Corp. achieved a cash conversion cycle of 14.70 days, indicating that the company takes approximately 14.70 days to convert its investments in inventory and receivables into cash from sales. This represents an improvement from the previous quarter's cycle of 20.82 days, suggesting better management of working capital during this period.
Looking at the trend over the past quarters, Unitil Corp. experienced its longest cash conversion cycle in Q1 2023 at 24.65 days, which may suggest delays in collecting receivables or longer inventory turnover. Conversely, the shortest cycle was observed in Q4 2022, where the company operated on a highly efficient system with a cash conversion cycle of just 0.48 days.
Overall, Unitil Corp. should continue monitoring its cash conversion cycle closely to ensure effective working capital management. A lower cycle duration generally implies faster cash flow and working capital turnover, which can positively impact the company's financial health and liquidity position. Identifying factors contributing to prolonged cycles and implementing strategies to optimize working capital efficiency can further enhance Unitil Corp.'s operational performance.