Century Aluminum Company (CENX)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 88,800 | 54,300 | 29,000 | 81,600 | 38,900 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 89,900 | 71,700 | 88,900 | 61,300 | 100,200 |
| Total current liabilities | US$ in thousands | 763,000 | 410,700 | 547,400 | 240,300 | 233,700 |
| Quick ratio | 0.23 | 0.31 | 0.22 | 0.59 | 0.60 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($88,800K
+ $—K
+ $89,900K)
÷ $763,000K
= 0.23
The quick ratio of Century Aluminum Company has exhibited variability over the past five years. The quick ratio measures a company's ability to meet its short-term obligations using its most liquid assets. The quick ratio is calculated by dividing current assets minus inventory by current liabilities.
In 2023, the quick ratio decreased to 0.23 from 0.31 in 2022, indicating a reduction in the company's ability to cover its short-term liabilities with its most liquid assets. This decline may raise concerns about Century Aluminum's liquidity position in the latest reporting period.
Comparing the current quick ratio to the ratios from previous years, 2023's quick ratio is lower than the ratios in 2020 and 2019 when the quick ratios were 0.59 and 0.60, respectively. These higher ratios suggest that in those years, Century Aluminum had a stronger ability to meet its short-term obligations with its quick assets.
However, it's worth noting that the quick ratio has shown fluctuations over the years. The quick ratio was particularly low in 2021 at 0.22, indicating potential liquidity challenges that year.
In conclusion, the decreasing trend in Century Aluminum's quick ratio in 2023 may warrant further investigation into the company's liquidity management and its ability to effectively meet short-term obligations using readily available assets.
Peer comparison
Dec 31, 2023