Innospec Inc (IOSP)
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 | 2.58 | 2.59 | 2.63 | 2.50 | 2.38 | 2.51 | 2.34 | 2.29 | 2.15 | 2.22 | 2.16 | 2.21 | 2.16 | 2.22 | 2.21 | 2.22 | 2.24 | 2.30 | 2.43 | 2.36 |
| Quick ratio | 1.70 | 1.69 | 1.62 | 1.61 | 1.52 | 1.49 | 1.31 | 1.28 | 1.19 | 1.16 | 1.11 | 1.26 | 1.27 | 1.27 | 1.29 | 1.33 | 1.29 | 1.19 | 1.24 | 1.37 |
| Cash ratio | 0.78 | 0.81 | 0.72 | 0.74 | 0.55 | 0.60 | 0.45 | 0.39 | 0.36 | 0.26 | 0.19 | 0.30 | 0.42 | 0.29 | 0.32 | 0.43 | 0.42 | 0.29 | 0.27 | 0.26 |
The current ratio of Innospec Inc has shown a gradual decline over the past few years, indicating a slight weakening of the company's liquidity position. It was relatively stable around 2.2 to 2.3 from 2020 to 2022, but started to decrease further in 2023 and 2024, reaching 2.38 in December 2023 and then improving slightly to 2.58 in December 2024. Overall, the current ratio remains above 2, suggesting that the company has a healthy level of current assets to cover its current liabilities.
The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also been fluctuating over the years. It was around 1.3 to 1.4 from 2020 to 2021, indicating the company's ability to meet its short-term obligations without relying on selling inventory. However, it started to decrease in 2022 and 2023, reaching a low of 1.19 in December 2022. It then improved in 2024 to reach 1.70 in December, showing a positive trend towards a stronger liquidity position.
The cash ratio, which focuses solely on the company's ability to cover its current liabilities with cash and cash equivalents, has shown a similar pattern of fluctuations. From relatively low levels in 2020 to 2022, the ratio increased significantly in 2023 and 2024, reaching 0.78 in December 2024. This indicates that Innospec has been able to build up its cash reserves in recent years, enhancing its ability to meet short-term obligations with readily available liquid assets.
In conclusion, while there have been some fluctuations in the liquidity ratios of Innospec Inc over the years, the overall trend suggests that the company has maintained a healthy liquidity position with a strong ability to meet its short-term obligations.
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 | 95.77 | 96.85 | 93.77 | 88.81 | 95.70 | 95.03 | 96.50 | 100.95 | 105.68 | 112.75 | 114.65 | 113.38 | 105.53 | 120.48 | 121.51 | 113.26 | 106.37 | 107.03 | 104.29 | 109.96 |
The cash conversion cycle of Innospec Inc has exhibited fluctuations over the period from March 31, 2020 to December 31, 2024. The cash conversion cycle represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
From March 31, 2020, when the cash conversion cycle was 109.96 days, it decreased to 104.29 days by June 30, 2020. However, it slightly increased to 107.03 days by September 30, 2020. Over the next few quarters, the trend continued with fluctuations, showing values of 106.37 days (December 31, 2020) and 113.26 days (March 31, 2021).
The cash conversion cycle peaked at 121.51 days on June 30, 2021, then gradually decreased to 105.53 days by December 31, 2021. The cycle increased again to 114.65 days by June 30, 2022, before declining to 88.81 days by March 31, 2024.
The cycle then showed some variability between 2024 and 2024 but generally stayed within the range of 88-96 days, indicating that Innospec Inc effectively managed its cash conversion cycle during this period.
Overall, the trend in the cash conversion cycle of Innospec Inc suggests fluctuations in managing its working capital and liquidity over time. The company may have implemented strategies to efficiently manage its inventory, receivables, and payables to optimize its cash conversion cycle and operational efficiency.