Silgan Holdings Inc (SLGN)
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 | 1.02 | 1.39 | 1.44 | 1.42 | 1.48 | 1.39 | 1.30 | 1.33 | 1.52 | 1.07 | 1.56 | 1.57 | 1.51 | 1.47 | 1.34 | 1.21 | 1.38 | 1.01 | 0.98 | 1.15 |
| Quick ratio | 0.54 | 0.84 | 0.69 | 0.78 | 0.86 | 0.81 | 0.60 | 0.65 | 0.89 | 0.64 | 0.80 | 0.80 | 0.86 | 0.85 | 0.68 | 0.74 | 0.70 | 0.54 | 0.46 | 0.57 |
| Cash ratio | 0.28 | 0.16 | 0.13 | 0.27 | 0.41 | 0.14 | 0.13 | 0.15 | 0.42 | 0.13 | 0.13 | 0.16 | 0.34 | 0.16 | 0.14 | 0.37 | 0.20 | 0.07 | 0.07 | 0.11 |
Silgan Holdings Inc.'s liquidity ratios show fluctuations over the past eight quarters. The current ratio, a measure of the company's ability to meet short-term obligations with its current assets, has generally been above 1, indicating that it has sufficient current assets to cover current liabilities. However, there was a decrease in Q4 2023 compared to the previous quarters, which might raise concerns about the company's liquidity position.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has also shown variability. While Silgan Holdings Inc. has generally maintained a quick ratio below 1, indicating a potential reliance on inventory to meet short-term obligations, the ratio decreased notably in Q4 2023 compared to the previous quarters. This may signal a reduced ability to cover immediate liabilities without relying on inventory conversion.
The cash ratio, which provides the most conservative measure of liquidity by focusing solely on cash and cash equivalents, has fluctuated significantly over the quarters. Silgan Holdings Inc.'s cash ratio dropped sharply in Q3 2023 but then increased in Q4 2023. This suggests that the company's ability to meet its short-term obligations solely through cash resources has been inconsistent.
Overall, the trends in Silgan Holdings Inc.'s liquidity ratios point to some variability in its ability to meet short-term obligations. A decreasing current ratio and quick ratio, along with fluctuating cash ratios, may indicate a need for the company to closely monitor and manage its liquidity position to ensure ongoing financial stability.
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 | 28.57 | 97.65 | 96.06 | 75.88 | 25.58 | 75.55 | 81.41 | 65.36 | 23.14 | 70.52 | 76.26 | 66.20 | 35.56 | 74.63 | 79.25 | 67.56 | 31.96 | 75.44 | 75.67 | 63.25 |
The cash conversion cycle of Silgan Holdings Inc. has shown fluctuations over the past eight quarters, indicating changes in the company's efficiency in converting its resources into cash.
In Q4 2023, the cash conversion cycle was 26.67 days, reflecting a relatively efficient performance compared to previous quarters. This indicates that the company managed its inventory, accounts receivable, and accounts payable effectively to generate cash within a shorter timeframe.
Conversely, in Q3 2023, Q2 2023, and Q1 2023, the cash conversion cycle was notably higher at 96.62 days, 96.94 days, and 76.65 days, respectively. These longer cycles suggest that Silgan Holdings took a longer time to convert its investments in inventory into sales and eventually into cash, potentially facing challenges with managing inventory levels, collection of receivables, or payment of payables during these periods.
Comparing to the previous year, Q4 2022 showed a shorter cash conversion cycle of 23.53 days, indicating a more efficient cash conversion process compared to the most recent quarter. However, Q3 2022, Q2 2022, and Q1 2022 had longer cycles at 75.22 days, 82.61 days, and 65.33 days, respectively, which might have impacted the company's liquidity and working capital management during those periods.
Overall, Silgan Holdings' cash conversion cycle has varied significantly over the past two years, highlighting the importance of closely monitoring working capital management practices to ensure optimal cash flow efficiency and liquidity for the company.