Spire Inc (SR)

The liquidity ratios of Spire Inc indicate its ability to meet its short-term obligations effectively. The current ratio has been declining over the past five years, from 0.82 in 2021 to 0.45 in 2024, suggesting a potential strain on the company's ability to cover its current liabilities with its current assets.

Similarly, the quick ratio has remained consistently low at around 0.11 over the last three years, indicating that Spire Inc may have difficulty meeting its short-term obligations without relying on inventory or prepaid expenses.

The cash ratio, which measures the company's ability to cover its current liabilities with its cash and cash equivalents, has shown fluctuations, with a notable increase to 0.04 in 2022 before dropping back to 0.00 in subsequent years.

Overall, the decreasing trend in these liquidity ratios over the years raises concerns about Spire Inc's short-term financial health and ability to manage its current liabilities effectively. It may indicate a need for the company to review its liquidity management strategies and enhance its cash reserves to improve its liquidity position going forward.

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Additional liquidity measure

The cash conversion cycle of Spire Inc has shown varied trends over the past five years. In the fiscal year ended September 30, 2024, the company's cash conversion cycle improved to 56.44 days from 60.45 days in the previous year. This indicates that the company was able to more efficiently convert its investments in inventory and accounts receivable into cash during this period.

In the fiscal year ended September 30, 2023, the cash conversion cycle was 60.45 days, showing a slight deterioration compared to the previous year. However, it is important to note that in the fiscal year ended September 30, 2022, the cash conversion cycle was significantly negative at -233.77 days. This anomaly suggests that Spire Inc was able to quickly convert its investments into cash, possibly due to strong sales and efficient working capital management.

In the fiscal year ended September 30, 2021, the cash conversion cycle further improved to -1,018.11 days, indicating an exceptional performance in cash conversion efficiency. However, in the fiscal year ended September 30, 2020, the cash conversion cycle was negative at -85.93 days, showing a relatively less efficient cash conversion cycle compared to the previous year.

Overall, the trend in Spire Inc's cash conversion cycle has been mixed, with fluctuations in efficiency over the past five years. It is important for the company to continuously monitor and optimize its cash conversion cycle to ensure efficient management of working capital and liquidity.