Chart Industries Inc (GTLS)

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 1.38 1.27 1.27 1.25 1.19 1.21 1.22 1.25 3.41 1.23 1.31 1.26 1.23 1.19 1.30 1.08 1.11 1.87 1.90 1.82
Quick ratio 0.17 0.15 0.13 0.10 0.11 0.03 0.05 0.09 0.61 0.12 0.19 0.14 0.18 0.39 0.47 0.29 0.32 0.37 0.34 0.25
Cash ratio 0.17 0.15 0.13 0.10 0.11 0.03 0.05 0.09 0.61 0.12 0.19 0.14 0.18 0.39 0.47 0.29 0.32 0.37 0.34 0.25

The current ratio for Chart Industries Inc experienced fluctuations over the years, with a notable increase from 1.11 in December 2020 to a peak of 3.41 in December 2022, before stabilizing around 1.2 in recent quarters. This indicates an improvement in the company's ability to cover its short-term obligations with its current assets.

The quick ratio, which excludes inventory from current assets, also varied significantly, decreasing from 0.32 in December 2020 to a low of 0.03 in September 2023, before recovering slightly to 0.17 by December 2024. This suggests some challenges in meeting immediate liabilities without relying on inventory sales.

The cash ratio, which is the most stringent liquidity measure, followed a similar trend to the quick ratio, reflecting the company's ability to cover current liabilities solely with cash and cash equivalents. The ratio declined from 0.32 in December 2020 to 0.03 in September 2023, showing a significant strain on liquidity, before improving to 0.17 by December 2024.

Overall, while the current ratio indicates an adequate ability to meet short-term obligations, the declining trends in the quick and cash ratios raise concerns about Chart Industries' liquidity position, particularly in the mid-term. Management should closely monitor and potentially adjust the company's liquidity management strategies to ensure sustainable financial health.

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 51.64 56.88 50.55 46.17 58.21 69.91 102.22 166.28 108.41 110.15 117.20 120.81 118.12 135.14 131.23 121.38 104.60 96.47 94.42 88.60

The cash conversion cycle of Chart Industries Inc has shown fluctuations over the past several quarters. From March 31, 2020, to December 31, 2021, the cycle increased steadily from 88.60 days to 118.12 days, indicating a lengthening period for the company to convert its investments in raw materials and other inputs into cash inflows from sales.

However, from March 31, 2022, to June 30, 2024, there was a notable improvement in the cash conversion cycle, decreasing from 120.81 days to 50.55 days. This indicates more efficiency in managing working capital and generating cash from operations.

The cycle spiked in March 31, 2023, reaching 166.28 days, possibly due to various factors such as changes in sales patterns, inventory management issues, or payment terms with customers and suppliers.

Overall, a shorter cash conversion cycle is typically favorable as it indicates that the company is able to quickly convert its investments into cash, demonstrating stronger liquidity and potentially better operational efficiency. It is essential for Chart Industries Inc to monitor and manage its cash conversion cycle effectively to ensure optimal working capital management and sustainable business performance.