Somnigroup International Inc. (SGI)

Liquidity ratios

	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	Dec 31, 2019
Current ratio	1.14	1.21	1.21	1.21	1.18	1.25	1.24	1.22	1.18	1.23	1.11	1.21	1.28	1.08	1.36	0.99	1.12	0.94	1.39	1.16
Quick ratio	0.57	0.59	0.60	0.58	0.58	0.57	0.54	0.50	0.54	0.56	0.49	0.68	0.87	0.61	0.77	0.46	0.65	0.49	0.76	0.56
Cash ratio	0.10	0.10	0.10	0.08	0.09	0.10	0.09	0.07	0.09	0.10	0.11	0.29	0.43	0.07	0.32	0.07	0.22	0.15	0.26	0.08

Somnigroup International Inc.'s liquidity ratios show varying levels of liquidity over the analyzed periods. The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, generally ranged between 0.94 and 1.39. This indicates that the company may have faced challenges in meeting its short-term liabilities at certain points but overall maintained a satisfactory level of liquidity.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, fluctuated between 0.46 and 0.87. While this ratio was lower than the current ratio, it still suggests that Somnigroup had an adequate ability to meet its short-term obligations with its most liquid assets.

The cash ratio, which focuses solely on cash and cash equivalents as a proportion of current liabilities, showed a range of 0.07 to 0.43. This indicates that the company had a limited amount of cash relative to its short-term liabilities in some periods, which could potentially pose liquidity risks.

Overall, while the company's current ratio generally improved over time and its quick ratio remained within acceptable levels, the cash ratio suggests that Somnigroup International Inc. may need to closely monitor its cash position to ensure it has enough liquidity to meet its short-term obligations effectively.

Additional liquidity measure

		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	Dec 31, 2019
Cash conversion cycle	days	54.90	56.22	55.03	56.23	54.76	56.27	59.77	56.16	54.78	56.95	45.32	35.25	29.17	34.94	44.01	35.94	35.74	41.59	43.65	45.54

The cash conversion cycle (CCC) of Somnigroup International Inc. has shown fluctuations over the past few years. The CCC represents the number of days it takes for a company to convert its investments in inventory and other resources into cash flows from sales.

From December 2019 to September 2021, the CCC showed a decreasing trend, indicating that the company was managing its cash flows efficiently and reducing the time it takes to convert resources into cash. This could be due to improved inventory management or faster collection of receivables.

However, from December 2021 onwards, the CCC started to increase again, reaching its peak at 59.77 days in March 2023. This increase suggests a potential slowdown in the company's ability to generate cash from its operations. Factors such as increased inventory levels, longer payment periods to suppliers, or slower collection of receivables could contribute to this lengthening of the CCC.

It is important for Somnigroup International Inc. to closely monitor its cash conversion cycle and identify the reasons behind any fluctuations. By efficiently managing its working capital components, the company can improve its cash flow position and overall financial performance.