LCI Industries (LCII)

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 2.82 2.88 2.82 2.86 2.83 2.97 2.80 3.13 3.30 3.01 2.66 2.47 2.50 1.99 2.21 2.00 2.09 1.99 2.25 2.56
Quick ratio 0.40 0.37 0.30 0.06 0.17 0.08 0.05 0.05 0.11 0.05 0.09 0.07 0.10 0.11 0.18 0.12 0.12 0.17 0.20 0.33
Cash ratio 0.40 0.37 0.30 0.06 0.17 0.08 0.05 0.05 0.11 0.05 0.09 0.07 0.10 0.11 0.18 0.12 0.12 0.17 0.20 0.33

The current ratio of LCI Industries has shown a generally positive trend over the years, improving from 2.56 in March 2020 to 2.82 by December 2024. This indicates the company's ability to cover its short-term liabilities with its current assets has strengthened over time.

On the other hand, the quick ratio has displayed significant fluctuations, ranging from 0.05 in March 2023 to 0.40 in December 2024. Although the quick ratio is more conservative than the current ratio as it excludes inventory from current assets, LCI Industries has shown variability in its ability to meet short-term obligations without relying on selling inventory.

The cash ratio, which focuses solely on the most liquid current assets, also exhibits fluctuations, ranging from 0.05 in March 2023 to 0.40 in December 2024. This ratio reflects the company's ability to cover its short-term liabilities using only cash and cash equivalents. LCI Industries has demonstrated some variability in its cash position over the years.

Overall, while the current ratio indicates a generally stable liquidity position for LCI Industries, the variability in the quick ratio and cash ratio suggests the company may need to better manage its short-term liquidity to ensure consistent ability to meet 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 93.96 88.66 84.91 90.39 93.22 93.86 94.37 93.74 95.54 95.96 101.78 107.68 116.63 93.27 81.23 83.19 86.25 69.24 67.07 68.28

Based on the provided data, LCI Industries' cash conversion cycle has shown fluctuations over the past few years. The cash conversion cycle is a measure of how efficiently a company manages its working capital to generate cash flow from its operations.

For LCI Industries, the cash conversion cycle ranged from a low of 67.07 days in June 2020 to a high of 116.63 days in December 2021. The cycle measures the average number of days it takes for the company to sell inventory, collect receivables, and pay its payables.

A shorter cash conversion cycle is generally favorable as it indicates that the company is able to efficiently manage its working capital, convert inventory into cash, and collect receivables quickly. Conversely, a longer cycle may signal potential issues such as slow inventory turnover, delayed receivables collection, or extended payment periods to suppliers.

From the data provided, it can be observed that LCI Industries experienced an increase in its cash conversion cycle towards the end of 2021 and continued at elevated levels until the first half of 2024. The company then managed to reduce its cash conversion cycle towards the end of 2024.

Overall, a detailed analysis of the components contributing to the cash conversion cycle, such as inventory turnover, accounts receivable collection period, and accounts payable turnover, would provide further insights into LCI Industries' working capital management and operational efficiency.