WEC Energy Group Inc (WEC)

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	112.57	81.17	88.02	106.92	97.95
Days of sales outstanding (DSO)	days	61.70	69.16	66.09	60.62	57.08
Number of days of payables	days	92.16	91.39	102.80	126.11	113.45
Cash conversion cycle	days	82.11	58.93	51.31	41.44	41.58

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 112.57 + 61.70 – 92.16
= 82.11

The cash conversion cycle for WEC Energy Group Inc has been fluctuating over the past five years. In 2023, the company's cash conversion cycle increased to 47.81 days from 36.41 days in 2022, indicating a longer period required to convert its investments in inventory and accounts receivable into cash. This trend is opposite to what was observed from 2020 to 2022 when the company managed to substantially shorten its cash conversion cycle.

Comparing 2023 to 2019, there has been a notable increase in the cash conversion cycle from 8.26 days to 47.81 days, suggesting that WEC Energy Group Inc may be facing challenges in efficiently managing its working capital and liquidity. It is important for the company to closely monitor its inventory and accounts receivable turnover ratios to improve its cash conversion cycle and enhance its overall financial performance.