Metallus Inc (MTUS)
Liquidity ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Current ratio | 2.64 | 2.98 | 2.32 | 1.98 | 3.58 |
| Quick ratio | 1.59 | 1.81 | 1.44 | 0.92 | 0.93 |
| Cash ratio | 1.13 | 1.38 | 1.04 | 0.57 | 0.24 |
Metallus Inc's liquidity ratios demonstrate its ability to meet short-term obligations effectively. The current ratio has fluctuated over the past five years but generally remains above 1. This indicates that the company is able to cover its current liabilities with current assets.
The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity as it excludes inventory from current assets. Metallus Inc's quick ratio has shown a similar trend as the current ratio, staying above 1 in recent years, which implies the company has a sufficient level of highly liquid assets to cover its short-term liabilities.
The cash ratio, which measures the company's ability to cover its current liabilities with its cash and cash equivalents, has shown significant improvement over the years, indicating a stronger liquidity position. This ratio reflects the company's ability to meet its obligations even if its operations were to experience a temporary halt.
Overall, based on the trends in these liquidity ratios, Metallus Inc appears to have maintained a solid liquidity position over the past five years, which is essential for its financial health and operational stability.
Additional liquidity measure
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 58.54 | 46.33 | 50.46 | 63.45 | 82.63 |
The cash conversion cycle of Metallus Inc has shown a fluctuating trend over the past five years. In 2023, the company's cash conversion cycle increased to 58.54 days from 46.33 days in 2022. This indicates that it took the company longer to convert its investments in inventory and accounts receivable into cash during the most recent year.
Comparing the trend to previous years, the cash conversion cycle was lower in 2022 compared to 2021, but higher than in 2020. The peak in the cash conversion cycle was observed in 2019 at 82.63 days, signifying a significant delay in the company's cash conversion efficiency at that time.
Overall, it is essential for Metallus Inc to analyze the reasons behind the fluctuations in its cash conversion cycle and take necessary actions to optimize working capital management. A lower cash conversion cycle indicates a more efficient cash management process, leading to improved liquidity and financial performance.