Ichor Holdings Ltd (ICHR)

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 3.34 3.64 4.27 4.16 4.06 3.90 4.25 3.97 3.09 2.61 2.52 2.37 2.22 2.98 2.73 2.75 3.06 2.20 2.04 1.85
Quick ratio 0.80 0.95 1.17 1.01 0.81 0.66 0.80 0.58 0.52 0.28 0.23 0.18 0.36 1.23 1.25 1.33 1.56 0.53 0.37 0.27
Cash ratio 0.80 0.95 1.17 1.01 0.81 0.66 0.80 0.58 0.52 0.28 0.23 0.18 0.36 1.23 1.25 1.33 1.56 0.53 0.37 0.27

The current ratio of Ichor Holdings Ltd has shown a generally increasing trend over the past few years, indicating an improvement in the company's short-term liquidity position. The ratio fluctuated between 1.85 and 3.97 during the period under review, with a significant peak of 4.27 as of June 30, 2024. This suggests that the company has been gradually strengthening its ability to meet its short-term obligations using its current assets.

On the other hand, the quick ratio, which gives a more conservative measure of liquidity by excluding inventory from current assets, also displays a similar trend, albeit with more fluctuations. While starting at a low point of 0.27 on March 31, 2020, the ratio increased significantly to reach 1.17 by June 30, 2024. This indicates that the company's ability to cover its short-term liabilities with its most liquid assets has improved over time.

Furthermore, the cash ratio, which denotes the proportion of immediate cash and cash equivalents to current liabilities, also shows a pattern of increase from 0.27 on March 31, 2020, to 0.80 by June 30, 2024. This implies that Ichor Holdings Ltd has enhanced its ability to settle its short-term obligations using cash reserves alone.

In summary, based on the data provided, Ichor Holdings Ltd has exhibited a positive trend in its liquidity ratios over the analyzed period, signifying a strengthened position to meet its short-term financial commitments.

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 121.73 120.21 117.98 126.29 126.81 125.31 108.34 97.97 96.93 100.50 107.83 102.06 93.74 79.55 70.09 63.88 62.31 67.66 79.99 86.26

The cash conversion cycle of Ichor Holdings Ltd has shown fluctuations over the periods outlined in the data provided. Starting from March 31, 2020, the company had a cash conversion cycle of 86.26 days, which decreased to 62.31 days by December 31, 2020, indicating an improvement in the efficiency of its working capital management.

The trend continued to show positive performance, with the cash conversion cycle reaching its lowest point of 63.88 days on March 31, 2021. However, from that point on, there was a gradual increase in the cash conversion cycle, peaking at 126.81 days on December 31, 2023.

It is worth noting that a higher cash conversion cycle implies that the company is taking longer to convert its investments in inventory back into cash. Therefore, a rising trend in the cash conversion cycle may indicate challenges in managing working capital effectively or potential issues in sales, inventory management, or accounts receivable collection.

In conclusion, the cash conversion cycle of Ichor Holdings Ltd has shown variability over the periods provided, with periods of improvement followed by increases. Monitoring this metric is crucial for the company to ensure efficient utilization of its working capital and timely conversion of investments into cash.