Matson Inc (MATX)
Liquidity ratios
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.07 | 1.11 | 1.05 | 1.06 | 1.31 | 1.46 | 1.76 | 1.43 | 1.15 | 0.88 | 0.76 | 0.60 | 0.60 | 0.64 | 0.61 | 0.66 | 0.66 | 0.68 | 0.68 | 0.75 |
| Quick ratio | 0.74 | 0.81 | 0.74 | 0.69 | 0.89 | 0.95 | 1.57 | 1.25 | 1.02 | 0.81 | 0.72 | 0.62 | 0.62 | 0.67 | 0.52 | 0.51 | 0.52 | 0.57 | 0.56 | 0.57 |
| Cash ratio | 0.24 | 0.27 | 0.22 | 0.17 | 0.43 | 0.40 | 0.96 | 0.64 | 0.46 | 0.21 | 0.13 | 0.11 | 0.12 | 0.15 | 0.04 | 0.04 | 0.05 | 0.05 | 0.06 | 0.04 |
Matson Inc's liquidity ratios provide insight into the company's ability to meet its short-term financial obligations. The current ratio, which measures current assets against current liabilities, has displayed a declining trend over the past few quarters, from 1.31 in Q4 2022 to 1.07 in Q4 2023. This suggests that the company may be facing challenges in meeting its short-term obligations using its current assets.
Similarly, the quick ratio, which excludes inventory from current assets, also exhibits a downward trend from 1.30 in Q4 2022 to 1.07 in Q4 2023. This indicates a potential difficulty in meeting immediate liabilities without relying on selling inventory.
The cash ratio, which assesses the company's ability to cover current liabilities with its most liquid assets (cash and equivalents), has shown a consistent decline from 0.54 in Q4 2022 to 0.35 in Q4 2023. This trend suggests that Matson Inc may have a reduced capacity to settle its short-term obligations solely with cash on hand.
Overall, the decreasing trend in all three liquidity ratios raises concerns about Matson Inc's short-term liquidity position and its ability to meet financial obligations as they come due. Investors and stakeholders may closely monitor these trends to assess the company's financial health and management of liquidity risks.
Additional liquidity measure
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 33.09 | 35.99 | 30.78 | 26.72 | 22.65 | 25.03 | 29.27 | 31.09 | 32.14 | 35.96 | 39.35 | 37.30 | 39.26 | 38.95 | 37.01 | 37.01 | 34.46 | -330.62 | -308.33 | -326.15 |
The cash conversion cycle of Matson Inc has shown fluctuations over the past eight quarters, ranging from 26.61 days to 47.72 days. The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash flow from sales. A lower cash conversion cycle indicates that the company is efficiently managing its working capital.
In Q4 2023, the cash conversion cycle increased to 47.72 days from 35.85 days in Q3 2023, indicating a potential slowdown in turning inventory into cash. This may be a cause for concern as it suggests a decrease in efficiency in managing working capital.
Comparing Q4 2023 to the same quarter in the previous year (Q4 2022), there was an increase in the cash conversion cycle from 36.92 days to 47.72 days, indicating a deterioration in the company's ability to efficiently convert investments in resources into cash.
On the other hand, in Q1 2023, the cash conversion cycle reached a recent low of 26.61 days, indicating strong efficiency in working capital management. This trend was also observed in Q3 2022 when the cash conversion cycle was at 24.94 days.
It is important for Matson Inc to monitor its cash conversion cycle closely to ensure efficient management of working capital and timely conversion of investments into cash flow from sales. Identifying the factors contributing to fluctuations in the cash conversion cycle can help the company improve its financial performance and maintain a healthy cash flow position.