Air Products and Chemicals Inc (APD)

Cash ratio

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Cash and cash equivalents	US$ in thousands	1,617,000	2,711,000	4,468,900	5,253,000	2,248,700
Short-term investments	US$ in thousands	332,200	590,700	1,331,900	1,104,900	166,000
Total current liabilities	US$ in thousands	3,895,800	3,465,800	2,799,100	2,416,700	1,820,900
Cash ratio		0.50	0.95	2.07	2.63	1.33

September 30, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,617,000K + $332,200K) ÷ $3,895,800K
= 0.50

The cash ratio of Air Products & Chemicals Inc. has exhibited a declining trend over the past five years, dropping from 2.86 in 2020 to 0.71 in 2023. This suggests that the company's ability to cover its short-term liabilities with its cash and cash equivalents has weakened over this period. A decreasing cash ratio may indicate a potential liquidity risk, as the company's cash position relative to its current liabilities has diminished. Further investigation into the company's cash management and liquidity position is advisable to understand the underlying reasons for this downward trajectory and to assess the potential impact on the company's financial health.