Innospec Inc (IOSP)

Quick ratio

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Cash US$ in thousands 289,200 203,700 147,100 141,800 105,300
Short-term investments US$ in thousands — — — — —
Receivables US$ in thousands 341,700 359,800 334,600 284,500 221,400
Total current liabilities US$ in thousands 371,400 371,500 405,800 336,600 252,400
Quick ratio 1.70 1.52 1.19 1.27 1.29

December 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($289,200K + $—K + $341,700K) ÷ $371,400K
= 1.70

The quick ratio of Innospec Inc has shown a generally stable trend over the past five years, ranging from 1.19 to 1.70. This ratio measures the company's ability to meet its short-term obligations with its most liquid assets, excluding inventory. A quick ratio above 1 indicates that the company has an adequate level of liquid assets to cover its short-term liabilities.

In 2020 and 2021, the quick ratio was above 1.2, suggesting a healthy liquidity position. However, there was a slight decrease in 2022 to 1.19, indicating a potential dip in liquidity. The ratio then improved significantly in 2023 to 1.52 and further increased in 2024 to 1.70, demonstrating strengthening liquidity and the ability to easily meet short-term obligations.

Overall, the trend in Innospec Inc's quick ratio indicates a prudent management of liquidity, with the company maintaining a comfortable cushion of liquid assets relative to short-term liabilities, which can provide financial stability and flexibility in managing its operations.