Cinemark Holdings Inc (CNK)

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 0.35 0.03 0.04 0.05 2.54 0.05 0.05 0.02 1.26 1.27 1.20 1.11 1.14 1.04 1.10 1.27 1.47 1.58 1.25 0.98
Quick ratio 0.31 0.80 1.02 1.20 2.46 -0.01 1.04 0.89 1.15 1.18 1.12 1.03 1.07 0.96 1.26 1.44 1.65 1.90 1.19 0.93
Cash ratio 0.31 0.80 1.02 1.20 2.46 -0.01 1.04 0.89 1.15 1.02 0.96 0.88 0.92 0.84 1.14 1.11 1.33 1.72 0.96 0.80

Based on the provided data, we can analyze the liquidity ratios of Cinemark Holdings Inc over the period from March 31, 2020, to December 31, 2024.

1. Current Ratio:
- The current ratio measures the company's ability to cover its short-term obligations with its current assets. A ratio of 1 or higher is generally considered acceptable.
- Cinemark's current ratio fluctuated over the period, ranging from a low of 0.02 on March 31, 2023, to a high of 2.54 on December 31, 2023.
- The trend shows some volatility but appears to generally meet the acceptable threshold, with the ratio mostly staying above 1, indicating a positive liquidity position.

2. Quick Ratio:
- The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity as it excludes inventory from current assets.
- Cinemark's quick ratio also fluctuated, with a low of -0.01 on September 30, 2023, indicating potential issues with the company's ability to meet its short-term obligations without relying on inventory.
- However, the quick ratio generally improved towards the end of the period, suggesting enhanced liquidity compared to the previous points.

3. Cash Ratio:
- The cash ratio is the most conservative measure of liquidity, focusing solely on the company's ability to cover its short-term liabilities with its cash and cash equivalents.
- Cinemark's cash ratio generally followed a similar trend to the quick ratio, indicating an ability to cover short-term obligations with cash holdings, though there were fluctuations in between.

Overall, while Cinemark Holdings Inc demonstrated some fluctuations in its liquidity ratios over the analyzed period, the current and quick ratios generally remained above 1, indicating a satisfactory liquidity position. However, attention may be required to manage short-term liquidity challenges, as seen during certain points in the timeline.


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 177.07 125.52 115.98 94.23 91.94 70.13 65.52 20.79 17.11 28.40 30.87 34.23 -21.47 45.98 72.16 349.52 56.64 42.49 34.27 19.35

The cash conversion cycle is an important metric that measures the efficiency of a company's working capital management by determining the time it takes for a company to convert its investments in inventory into cash flows from sales.

Analyzing Cinemark Holdings Inc's cash conversion cycle data from the provided JSON, we observe fluctuations over the quarters. In the first few quarters of the data, the cash conversion cycle ranged between around 20 to 60 days, indicating a relatively efficient cycle. This means Cinemark was able to turn its inventory into cash within a reasonable timeframe during this period.

However, the cash conversion cycle spiked significantly in the March 31, 2021 quarter, reaching 349.52 days. This sudden increase suggests potential issues with managing working capital efficiently, as the company took much longer to convert inventory into sales and cash during this period.

Subsequently, there was a fluctuating trend in the following quarters, with the cycle ranging from negative days to around 70 days. A negative cash conversion cycle, such as in December 31, 2021, indicates that the company was able to collect cash from customers before paying its suppliers, which is a positive sign.

In the most recent quarters, the cash conversion cycle has stabilized between 90 to 177 days. Although there is an improvement from the extreme highs seen in early 2021, the cycle still indicates that Cinemark may be taking a relatively extended period to convert its inventory into cash, which could affect its liquidity and working capital management.

Overall, the analysis of Cinemark Holdings Inc's cash conversion cycle highlights periods of efficient working capital management as well as instances of slower conversion of inventory into cash. It is essential for the company to closely monitor and manage its cash conversion cycle to ensure optimal use of its resources and maintain financial health.