Essential Utilities Inc (WTRG)
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 | 39.67 | 44.32 | 59.97 | 44.89 | 30.70 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 39.67 | 44.32 | 59.97 | 44.89 | 30.70 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 39.67 + — – —
= 39.67
The cash conversion cycle of Essential Utilities Inc has fluctuated over the past five years.
In December 31, 2020, the cash conversion cycle was 30.70 days, indicating that the company was efficient in converting its investments in inventory and accounts receivable into cash.
However, by December 31, 2021, the cash conversion cycle had increased to 44.89 days, suggesting a longer time taken by the company to convert its resources into cash.
This trend continued into December 31, 2022, with the cash conversion cycle reaching 59.97 days, indicating potential challenges in managing working capital efficiently.
By December 31, 2023, there was a slight improvement in the cash conversion cycle to 44.32 days, but it still remained higher compared to the initial period in 2020.
In the latest period of December 31, 2024, the cash conversion cycle decreased to 39.67 days, signaling an improvement in the company's ability to manage its working capital effectively.
Overall, Essential Utilities Inc's cash conversion cycle has shown fluctuations over the years, with a general trend towards longer cycles, highlighting potential areas for improvement in working capital management.
Peer comparison
Dec 31, 2024