Aptiv PLC (APTV)

Liquidity ratios

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Current ratio 1.53 1.50 1.49 1.29 1.72 1.81 1.76 1.71 1.60 2.66 2.63 2.60 2.01 2.11 2.06 1.97 1.85 1.84 1.89 1.69
Quick ratio 1.00 1.00 1.02 0.82 1.13 1.20 1.14 1.09 1.07 2.07 1.98 1.98 1.48 1.51 2.00 1.48 1.44 1.41 1.39 1.26
Cash ratio 0.31 0.32 0.37 0.16 0.34 0.37 0.27 0.24 0.32 1.19 1.16 1.18 0.76 0.74 1.25 0.71 0.70 0.59 0.66 0.56

Based on the data provided for Aptiv PLC, the liquidity ratios show a fluctuating trend over the years.

1. Current Ratio: The current ratio measures the company's ability to cover its short-term liabilities with its short-term assets. Aptiv's current ratio has generally been increasing from March 31, 2020, to September 30, 2022, indicating an improving liquidity position. However, there was a significant drop in the current ratio by December 31, 2022, and a further decline by March 31, 2024, which may raise concerns about the company's ability to meet its short-term obligations.

2. Quick Ratio: The quick ratio, also known as the acid-test ratio, provides a more conservative measure of liquidity by excluding inventory from current assets. Aptiv's quick ratio has shown fluctuations over the years, with some periods showing a strong ability to cover short-term liabilities without relying on inventory. However, there was a decrease in the quick ratio by December 31, 2022, and March 31, 2024, which could suggest potential challenges in meeting immediate obligations.

3. Cash Ratio: The cash ratio provides insight into the company's ability to cover its current liabilities using only its cash and cash equivalents. Aptiv's cash ratio has experienced variability, with some periods showing a strong cash position relative to current liabilities. However, there has been a decline in the cash ratio by December 31, 2022, and March 31, 2024, which may indicate a reduced ability to settle immediate debts solely with cash reserves.

Overall, while the current ratio and quick ratio demonstrated periods of strength in Aptiv's liquidity position, the declining trends in these ratios towards the end of the period, coupled with a decrease in the cash ratio, suggest potential challenges in managing short-term liquidity and meeting immediate financial obligations. Management should closely monitor these ratios to ensure adequate liquidity levels for sustaining operations and growth.

Additional liquidity measure

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Cash conversion cycle days 54.70 63.95 60.07 60.75 53.89 58.86 62.03 65.33 58.04 66.84 66.06 62.03 47.35 57.97 47.72 47.22 42.46 52.66 54.17 38.89

The cash conversion cycle of Aptiv PLC has shown some fluctuations over the period from March 31, 2020, to December 31, 2024. Generally, a shorter cash conversion cycle is indicative of more efficient management of working capital.

The cycle started at 38.89 days on March 31, 2020, increased to 66.84 days on September 30, 2022, and then gradually decreased to 54.70 days by December 31, 2024. The peak point of 66.84 days could indicate potential issues with cash flow management and working capital efficiency.

Overall, Aptiv PLC seems to have made efforts to improve its cash conversion cycle from 2022 onwards. However, further analysis would be needed to understand the reasons behind the fluctuations and to assess the impact on the company's overall financial health and operational efficiency.