One Gas Inc (OGS)

Liquidity ratios

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Current ratio 0.64 0.52 1.02 2.27 0.68
Quick ratio 0.04 0.01 0.01 0.01 0.01
Cash ratio 0.04 0.01 0.01 0.01 0.01

One Gas Inc's liquidity ratios exhibit fluctuations over the years, as follows:

1. Current Ratio:
- The current ratio increased significantly from 0.68 in 2020 to 2.27 in 2021, indicating a substantial improvement in the company's ability to cover its short-term obligations with current assets.
- However, the ratio declined to 1.02 in 2022 and further dropped to 0.52 in 2023, indicating a potential strain on the company's short-term liquidity position.
- By the end of 2024, the current ratio improved slightly to 0.64 but remained below the ideal value of 1, suggesting that One Gas Inc may still face challenges in meeting its short-term liabilities.

2. Quick Ratio:
- The quick ratio remained consistently low at 0.01 from 2020 to 2023, reflecting a limited ability to cover immediate liabilities with liquid assets like cash and accounts receivable.
- In 2024, the quick ratio improved to 0.04, indicating a slight enhancement in the company's liquidity position and its ability to meet short-term obligations without relying heavily on inventory.

3. Cash Ratio:
- Similar to the quick ratio, the cash ratio was constant at 0.01 between 2020 and 2023, suggesting that One Gas Inc had limited liquid cash to cover short-term obligations.
- However, by the end of 2024, the cash ratio increased to 0.04, indicating an improvement in the company's cash position and its ability to meet short-term liabilities using cash reserves.

Overall, the liquidity ratios of One Gas Inc show a mix of improvements and fluctuations over the years, with the current ratio showing significant variability and the quick and cash ratios demonstrating some enhancement towards the end of the period. It is essential for the company to closely monitor and manage its liquidity position to ensure it can meet its short-term obligations effectively.


Additional liquidity measure

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Cash conversion cycle days 70.53 58.82 64.27 69.90 55.29

The cash conversion cycle of One Gas Inc has shown variability over the years. In 2020, the cash conversion cycle was 55.29 days, indicating that the company took approximately 55 days to convert its investments in inventory and other resources into cash flows from sales.

However, by the end of 2021, the cash conversion cycle had extended to 69.90 days, suggesting a slower conversion of resources into cash. This increase may be attributed to changes in the company's operations, inventory management, or payment terms.

In 2022, the cash conversion cycle improved slightly to 64.27 days, reflecting a quicker conversion of resources into cash compared to the previous year. This improvement may indicate more efficient working capital management practices within the company.

By the end of 2023, the cash conversion cycle decreased further to 58.82 days, signaling a more efficient utilization of resources to generate cash flows. This reduction may have been achieved through better inventory management, collection processes, or payment terms negotiation.

However, in 2024, the cash conversion cycle increased again to 70.53 days, indicating a slower conversion of investments into cash. This reversal in trend could be attributed to various factors such as changes in the company's operating cycle, market conditions, or strategic decisions.

Overall, analyzing the cash conversion cycle provides insights into One Gas Inc's efficiency in managing its working capital and the effectiveness of its operations in generating cash flows from sales.