Johnson Controls International PLC (JCI)
Cash ratio
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 835,000 | 2,031,000 | 1,336,000 | 1,951,000 | 2,805,000 |
| Short-term investments | US$ in thousands | — | — | 1,066,000 | — | — |
| Total current liabilities | US$ in thousands | 11,084,000 | 11,239,000 | 9,098,000 | 8,248,000 | 9,070,000 |
| Cash ratio | 0.08 | 0.18 | 0.26 | 0.24 | 0.31 |
September 30, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($835,000K
+ $—K)
÷ $11,084,000K
= 0.08
The cash ratio of Johnson Controls International plc has exhibited a declining trend over the past five years, standing at 0.18 in 2023, down from 0.29 in 2022 and 0.26 in 2021. This signifies a reduced ability to cover short-term obligations solely with cash and cash equivalents.
The decreasing trend may indicate that the company's liquidity position has weakened over the years, possibly due to increased investment in non-cash assets or a rise in short-term liabilities relative to available cash.
Further investigation into the components of the cash ratio, including the levels of cash and cash equivalents and current liabilities, would be necessary to gain a deeper understanding of the factors driving this decline.
As an analyst, it would be pertinent to assess the reasons behind the declining trend and evaluate the potential implications for the company's solvency and short-term financial health. Additionally, monitoring the cash management strategies and working capital management practices of Johnson Controls International plc would be essential for assessing its ability to meet its short-term obligations.
Peer comparison
Sep 30, 2023