Celanese Corporation (CE)

The liquidity ratios of Celanese Corp for the past five years show fluctuations in the company's ability to meet its short-term obligations with its current assets.

The current ratio has been relatively stable over the period, ranging between 1.52 and 1.91, with a noticeable decrease in 2023 to 1.53. This ratio indicates that Celanese Corp may have slightly fewer current assets available to cover its current liabilities compared to the previous year.

The quick ratio, which provides a more conservative measure of liquidity by excluding inventory from current assets, has also been fluctuating, ranging from 0.91 to 1.41. In 2023, the quick ratio improved slightly to 0.95 from 0.93 in the previous year, signaling a slight strengthening of Celanese Corp's ability to meet immediate short-term obligations.

The cash ratio, which is the most stringent measure of liquidity as it considers only cash and cash equivalents, shows volatility over the years, ranging from 0.25 to 0.78. In 2023, the cash ratio increased significantly to 0.51, indicating that Celanese Corp had a higher proportion of cash on hand to cover current liabilities.

Overall, while there have been fluctuations in Celanese Corp's liquidity ratios over the past five years, the company has generally maintained a reasonable level of liquidity to meet its short-term obligations. However, continuous monitoring of these ratios is essential to ensure the company's financial health and ability to withstand economic uncertainties.

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Additional liquidity measure

The cash conversion cycle of Celanese Corp has shown fluctuating trends over the past five years. In 2023, the cash conversion cycle decreased to 96.60 days from 142.07 days in 2022, indicating an improvement in the company's efficiency in converting its resources into cash. This reduction can be attributed to effective management of inventory, receivables, and payables.

Comparing to 2021, when the cash conversion cycle was at 93.96 days, the increase in 2022 was concerning. However, in 2023, the company managed to bring the cycle back closer to the 2021 level. The cash conversion cycle in 2020 and 2019 was also relatively stable around the mid-90s range.

Overall, the downward trend in 2023 is a positive sign of the company's ability to manage its working capital effectively. Continued focus on optimizing inventory levels, accelerating collections from customers, and extending payment terms to suppliers could further enhance Celanese Corp's cash conversion cycle in the future.