ResMed Inc (RMD)

Cash ratio

Mar 31, 2025 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
Cash and cash equivalents US$ in thousands 932,711 521,944 426,361 238,361 237,910 210,247 209,100 227,891 227,894 253,199 207,163 273,710 201,769 194,476 276,149 295,278 230,635 255,865 421,414 463,156
Short-term investments US$ in thousands — — — 12,026 21,537 7,617 11,821 12,423 12,115 4,980 — 9,167 17,842 19,566 33,138 — 24,011 — 2,020 —
Total current liabilities US$ in thousands 940,516 851,960 904,079 910,655 773,030 764,073 770,802 758,533 761,691 732,714 692,659 689,299 667,265 621,064 624,158 911,766 876,541 577,335 590,853 602,761
Cash ratio 0.99 0.61 0.47 0.27 0.34 0.29 0.29 0.32 0.32 0.35 0.30 0.41 0.33 0.34 0.50 0.32 0.29 0.44 0.72 0.77

March 31, 2025 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($932,711K + $—K) ÷ $940,516K
= 0.99

The cash ratio of ResMed Inc. over the analyzed period exhibits noteworthy fluctuations indicative of changes in the company's liquidity position. Initially, during the fiscal year ending June 30, 2020, the cash ratio stood at 0.77, reflecting a strong liquidity cushion with cash and cash equivalents covering approximately 77% of current liabilities. This high ratio suggests a conservative liquidity stance, enabling the company to meet short-term obligations comfortably.

Subsequently, the cash ratio experienced a decline, reaching a low of 0.29 as of March 31, 2021, which indicates a reduction in the proportion of current liabilities covered solely by cash and equivalents. This decline was accompanied by a pattern of fluctuations within the subsequent periods, with ratios oscillating between approximately 0.27 and 0.50 through the year ending September 30, 2021, and into early 2022, reflecting variable short-term liquidity.

From late 2022 through mid-2023, the cash ratio stabilized around 0.29 to 0.34, maintaining a cautious liquidity stance. Notably, in the most recent period ending March 31, 2025, the cash ratio surged to 0.99, approaching a near-full coverage scenario where cash and cash equivalents nearly equal the company's current liabilities. This significant increase suggests an improvement in liquidity position, possibly due to strategic cash accumulation, asset liquidations, or reduced short-term liabilities.

Overall, while the early period demonstrates a conservative liquidity position with a high cash ratio, the subsequent decline indicates increased utilization of cash for operational or strategic purposes. The recent sharp rise to nearly full liquidity coverage signals a potential strengthening of cash reserves, enhancing the company's ability to meet short-term obligations with minimal reliance on other current assets. The trend highlights periods of liquidity management adjustments, aligning with operational needs, strategic initiatives, or market conditions.