Fresh Del Monte Produce Inc (FDP)

Liquidity ratios

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Current ratio 2.12 2.02 1.97 2.07 2.05 1.88 1.73 1.80 1.74 1.78 1.83 1.84 1.82 1.80 1.82 1.84 1.87 1.95 0.91 1.92
Quick ratio 1.04 0.94 0.94 0.91 0.86 0.74 0.02 0.04 0.78 0.04 0.04 0.05 0.82 0.78 0.87 0.85 0.89 0.86 0.43 0.87
Cash ratio 0.06 0.13 0.07 0.06 0.03 0.04 0.02 0.04 0.03 0.04 0.04 0.05 0.03 0.03 0.06 0.03 0.06 0.03 0.01 0.04

Fresh Del Monte Produce Inc's liquidity ratios have shown some variability over the past few quarters. The current ratio, which measures the company's ability to cover short-term obligations with its current assets, has generally been above 1, indicating a healthy liquidity position. It has ranged from a low of 1.73 to a high of 2.12 during the period under review.

In contrast, the quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has been more volatile. It has fluctuated between 0.02 and 1.04, with some periods showing potential liquidity challenges, particularly in the middle of the period.

The cash ratio, which is the most conservative measure of liquidity as it only considers cash and cash equivalents, has also varied significantly. While it has generally been low, indicating a reliance on other current assets to meet short-term obligations, it has shown some improvement in recent quarters.

Overall, Fresh Del Monte Produce Inc's liquidity ratios suggest a generally strong liquidity position, with the current ratio consistently above 1 and improvements in the cash ratio over time. However, the fluctuation in the quick ratio warrants further scrutiny to understand the company's ability to meet its short-term obligations without relying on inventory.

Additional liquidity measure

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Cash conversion cycle days 73.89 92.75 96.10 100.19 72.00 91.55 50.47 56.45 64.20 49.96 46.37 48.23 57.41 81.69 82.51 88.42 59.27 82.81 86.05 90.91

The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. Fresh Del Monte Produce Inc's cash conversion cycle fluctuated over the analyzed periods. Looking at trend, we can see that from the most recent data in December 2023 to the end of 2020, the cash conversion cycle ranged from a low of 72.00 days to a high of 100.19 days, with an average of approximately 80 days.

A shorter cash conversion cycle indicates that the company is able to quickly sell its inventory and collect cash from customers, translating to more efficient operations and potentially better liquidity. Conversely, a longer cash conversion cycle may indicate inefficiencies in inventory management, sales, or collection processes.

Fresh Del Monte's cash conversion cycle has been relatively stable in recent quarters, with minor fluctuations. It is important for management to monitor this metric closely to ensure optimal working capital management and operational efficiency. Further analysis could reveal the specific drivers behind the fluctuations and help identify potential areas for improvement.