Aramark Holdings (ARMK)

Cash ratio

		Sep 30, 2024	Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020
Cash and cash equivalents	US$ in thousands	672,483	1,927,090	329,452	532,591	2,509,190
Short-term investments	US$ in thousands	42,342	36,051	78,204	—	—
Total current liabilities	US$ in thousands	4,214,210	5,029,970	3,285,890	2,857,430	2,347,460
Cash ratio		0.17	0.39	0.12	0.19	1.07

September 30, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($672,483K + $42,342K) ÷ $4,214,210K
= 0.17

The cash ratio of Aramark Holdings has fluctuated over the past five years.

In 2020, the cash ratio was notably high at 1.07, indicating the company had a strong ability to cover its short-term liabilities with its available cash. However, in the following year, the cash ratio dropped to 0.19, suggesting a decrease in the company's liquidity position.

Subsequently, in 2022, the cash ratio decreased further to 0.12, indicating a potential liquidity strain. This was followed by a significant improvement in 2023, with the cash ratio increasing to 0.39, suggesting a recovery in the company's ability to meet its short-term obligations.

In the most recent period of September 30, 2024, the cash ratio decreased to 0.17, indicating a slight decline in liquidity compared to the previous year.

Overall, the trend in Aramark Holdings' cash ratio reflects fluctuations in the company's liquidity position over the past five years. It is essential for the company to maintain a healthy cash ratio to ensure it can meet its short-term obligations effectively.