Carnival Corporation (CCL)
Liquidity ratios
| Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 0.29 | 0.30 | 0.28 | 0.36 | 0.46 | 0.43 | 0.52 | 0.64 | 0.71 | 0.65 | 0.64 | 0.74 | 0.97 | 0.94 | 1.16 | 1.45 | 1.22 | 0.91 | 0.69 | 0.27 |
| Quick ratio | 0.15 | 0.18 | 0.16 | 0.23 | 0.52 | 0.56 | 0.65 | 0.78 | 0.42 | 0.57 | 0.57 | 0.66 | 0.90 | 0.85 | 1.08 | 1.36 | 1.13 | 0.84 | 0.63 | 0.16 |
| Cash ratio | 0.10 | 0.12 | 0.12 | 0.18 | 0.47 | 0.52 | 0.62 | 0.73 | 0.38 | 0.55 | 0.54 | 0.63 | 0.88 | 0.82 | 1.06 | 1.34 | 1.10 | 0.80 | 0.58 | 0.13 |
Carnival Corporation's liquidity ratios have shown fluctuations over the years based on the provided data.
1. Current Ratio: The company's current ratio has varied between 0.27 to 1.45 during the period from February 29, 2020, to November 30, 2024. The current ratio improved significantly from 2020 to early 2021, indicating a better ability to cover its short-term liabilities with current assets. However, the ratio declined towards the end of 2021 and stayed below 1 thereafter, indicating a potential liquidity concern as the company may struggle to meet its short-term obligations with its current assets alone.
2. Quick Ratio: Carnival Corporation's quick ratio ranged from 0.16 to 1.36 over the same period. Similar to the current ratio, the quick ratio improved initially before declining in late 2021 and beyond. This ratio excludes inventory from current assets, providing a more conservative measure of the company's ability to meet short-term obligations with its most liquid assets. The decreasing trend may suggest potential challenges in meeting immediate payment demands without relying on selling inventory.
3. Cash Ratio: The cash ratio of Carnival Corporation varied between 0.10 to 1.34 during the period analyzed. It reflects the company's ability to cover its short-term liabilities with cash and cash equivalents alone. The cash ratio also shows a declining trend over time, indicating a reduction in the company's ability to meet short-term obligations purely through its cash reserves.
Overall, the downward trends in all three liquidity ratios towards the latter part of the period suggest a potential liquidity strain on Carnival Corporation, possibly indicating challenges in meeting short-term financial obligations with available liquid assets. It is important for the company to closely monitor its liquidity position and take necessary steps to improve its ability to fulfill its short-term commitments.
See also:
Additional liquidity measure
| Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | -5.81 | -3.65 | -5.18 | -2.68 | -5.86 | -5.86 | -5.39 | -1.85 | -5.66 | -1.05 | 8.24 | 17.58 | 38.53 | 119.88 | 551.89 | 127.26 | 5.71 | 1.91 | -28.51 | -5.61 |
The cash conversion cycle of Carnival Corporation had been negative for several periods, indicating that the company was able to convert its inventory to cash quickly and efficiently. However, the cash conversion cycle turned positive in February 2021, reaching a high of 551.89 days in May 2021, which was a cause for concern as it suggested a slowdown in cash flow generation.
Subsequently, Carnival Corporation made improvements in managing its working capital, reducing the cash conversion cycle to 8.24 days by May 31, 2022, and even achieving negative values in the following periods. Negative cash conversion cycle days imply that Carnival Corporation is able to collect cash from customers before paying its suppliers, resulting in a more efficient cash management process.
Overall, the trend of the cash conversion cycle for Carnival Corporation shows fluctuations over time but indicates a stronger position in managing working capital and cash flow efficiency in recent periods.