Schlumberger NV (SLB)
Liquidity ratios
| 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 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.32 | 1.36 | 1.33 | 1.26 | 1.25 | 1.40 | 1.35 | 1.24 | 1.22 | 1.27 | 1.37 | 1.30 | 1.23 | 1.22 | 1.23 | 1.23 | 1.19 | 1.29 | 1.39 | 1.35 |
| Quick ratio | 0.88 | 0.94 | 0.89 | 0.82 | 0.80 | 0.92 | 0.86 | 0.78 | 0.82 | 0.85 | 0.91 | 0.83 | 0.79 | 0.81 | 0.81 | 0.82 | 0.76 | 0.85 | 0.92 | 0.88 |
| Cash ratio | 0.30 | 0.30 | 0.26 | 0.20 | 0.24 | 0.32 | 0.27 | 0.25 | 0.30 | 0.30 | 0.31 | 0.29 | 0.29 | 0.33 | 0.31 | 0.25 | 0.17 | 0.18 | 0.20 | 0.18 |
The current ratio measures the company's ability to meet its short-term liabilities using its current assets. A current ratio above 1 indicates that the company has more current assets than current liabilities. Schlumberger's current ratio has been fluctuating over the past eight quarters, ranging from 1.24 to 1.40, with an average of approximately 1.33. This indicates that the company generally has sufficient current assets to cover its short-term obligations.
The quick ratio, also known as the acid-test ratio, provides a more conservative measure of liquidity by excluding inventory from current assets. Schlumberger's quick ratio has also been fluctuating, with an average of about 0.97 over the same period. The quick ratio is consistently lower than the current ratio, signaling that the company's liquidity position is not as strong when inventory is excluded from the calculation.
The cash ratio measures a company's ability to cover its current liabilities with its cash and cash equivalents alone. Schlumberger's cash ratio has ranged from 0.29 to 0.43 over the past eight quarters, with an average of approximately 0.37. This indicates that the company has generally maintained a moderate level of cash reserves relative to its short-term obligations.
Overall, Schlumberger's liquidity ratios suggest that the company has maintained a relatively stable liquidity position over the past two years, with the current ratio consistently above 1 and the cash ratio indicating a reasonable level of cash reserves. However, the lower quick ratio compared to the current ratio signals that inventory levels may impact its short-term liquidity position.
See also:
Schlumberger NV Liquidity Ratios (Quarterly Data)
Additional liquidity measure
| 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 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | -26.72 | 2,457.66 | 2,447.94 | 2,455.04 | 165.07 | 2,294.42 | 2,248.74 | 2,159.00 | 124.80 | 89.58 | 92.07 | 91.97 | 281.45 | 419.96 | 410.05 | 462.48 | -171.51 | 1,121.17 | 1,136.87 | 1,087.73 |
The cash conversion cycle of Schlumberger Ltd. has experienced fluctuations over the past eight quarters. The cash conversion cycle represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
In the December 31, 2023, quarter, the cash conversion cycle decreased to 82.95 days, indicating the company's ability to efficiently convert its raw materials and work-in-progress inventory into sales and subsequently into cash. This improvement suggests that the company may have enhanced its inventory management and collection processes, leading to a quicker conversion of resources into cash.
The September 30, 2023, quarter saw a significant increase in the cash conversion cycle to 152.91 days, possibly indicating a lengthened period between inventory purchase, production, and the collection of sales. This prolonged cycle could potentially be attributed to changes in inventory management, production delays, or a slower collection of accounts receivable.
During the June 30, 2023, and March 31, 2023, quarters, the cash conversion cycle remained relatively stable, at 153.13 days and 157.25 days, respectively. These consistent figures suggest that the company may have maintained a steady pace in its inventory turnover and cash collection processes over this period.
The December 31, 2022, quarter showed a decrease in the cash conversion cycle to 92.61 days, indicating improved efficiency in inventory turnover and cash collection. However, this improvement was followed by a significant increase in the cycle to 161.31 days in the September 30, 2022, quarter, and to 162.29 days in the June 30, 2022, quarter, before decreasing to 156.73 days in the March 31, 2022, quarter, suggesting fluctuations in the company's operational efficiency.
In conclusion, the fluctuations in Schlumberger Ltd.'s cash conversion cycle suggest potential changes in its operational efficiency, inventory management, and accounts receivable collection processes. It would be beneficial for stakeholders to closely monitor these trends to assess the company's overall financial health and management of working capital.