Schlumberger NV (SLB)
Liquidity ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Current ratio | 1.45 | 1.32 | 1.25 | 1.22 | 1.23 |
| Quick ratio | 0.99 | 0.88 | 0.80 | 0.82 | 0.79 |
| Cash ratio | 0.36 | 0.30 | 0.24 | 0.30 | 0.29 |
Schlumberger NV's liquidity ratios indicate its ability to meet short-term obligations and manage its current assets effectively.
1. Current Ratio: The current ratio has generally been stable over the period, showing a slight increase from 1.23 in 2020 to 1.45 in 2024. This suggests that the company's current assets are sufficient to cover its current liabilities. A ratio above 1 indicates that Schlumberger NV has an adequate level of liquidity in the short term.
2. Quick Ratio: The quick ratio, which excludes inventory from current assets, also demonstrates a similar trend with a slight improvement from 0.79 in 2020 to 0.99 in 2024. This ratio reflects the company's ability to meet immediate liabilities without relying on selling inventory.
3. Cash Ratio: The cash ratio, which measures the company's ability to cover current liabilities with its cash and cash equivalents, shows some fluctuation but generally provides a positive picture of liquidity. The ratio increased from 0.29 in 2020 to 0.36 in 2024, indicating that Schlumberger NV has a reasonable level of cash to settle its short-term debts.
Overall, Schlumberger NV's liquidity ratios demonstrate a stable and sound financial position with sufficient liquidity to meet its short-term obligations. The upward trend observed in these ratios over the years indicates an improving ability to manage liquidity effectively.
See also:
Additional liquidity measure
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 123.22 | -26.71 | 131.18 | 124.80 | 289.56 |
The cash conversion cycle of Schlumberger NV has shown significant fluctuations over the years based on the data provided.
In December 2020, the cash conversion cycle stood at 289.56 days, indicating that it took the company almost a full year to convert its investments in inventory and accounts receivable into cash. However, by the end of December 2021, the cash conversion cycle improved to 124.80 days, reflecting a more efficient utilization of cash resources.
During the next reporting period, as of December 31, 2022, the cash conversion cycle increased slightly to 131.18 days, suggesting a longer period to convert investments into cash compared to the previous year.
Surprisingly, by the end of December 2023, the cash conversion cycle turned negative, indicating a negative cash conversion cycle of -26.71 days. This anomaly could imply that the company is effectively managing its working capital, possibly accelerating cash flows and optimizing the conversion process.
However, in the most recent period of December 31, 2024, the cash conversion cycle increased to 123.22 days, showing a slightly longer period for the conversion of investments into cash compared to the previous year.
Overall, Schlumberger NV's cash conversion cycle has experienced fluctuations, but the negative cash conversion cycle in 2023 may indicate effective working capital management, despite the subsequent increase in the cycle in 2024. It is essential for the company to continue monitoring and optimizing its cash conversion cycle to maintain efficient cash flow management in the future.