SunCoke Energy Inc (SXC)
Liquidity ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Current ratio | 1.86 | 1.67 | 1.49 | 1.45 | 1.58 |
| Quick ratio | 1.02 | 0.87 | 0.78 | 0.60 | 0.82 |
| Cash ratio | 0.63 | 0.40 | 0.35 | 0.30 | 0.50 |
SunCoke Energy Inc's liquidity ratios have shown improvement over the past five years. The current ratio has consistently increased from 1.58 in 2019 to 1.86 in 2023, indicating that the company's current assets are sufficient to cover its current liabilities. The quick ratio has also exhibited a positive trend, rising from 0.83 in 2019 to 1.05 in 2023, suggesting that SunCoke Energy has an adequate level of liquid assets to meet its short-term obligations without relying extensively on inventory.
Furthermore, the cash ratio has shown a steady increase from 0.51 in 2019 to 0.65 in 2023, indicating that the company has improved its ability to cover its current liabilities solely with cash and cash equivalents. This highlights SunCoke Energy's enhanced liquidity position and ability to meet its short-term financial obligations effectively.
Overall, the improving trend in SunCoke Energy Inc's liquidity ratios suggests that the company has strengthened its financial position and has a good ability to cover its short-term liabilities with its current assets, especially cash and highly liquid assets. This bodes well for the company's ability to navigate through potential financial challenges and take advantage of growth opportunities in the future.
Additional liquidity measure
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 33.45 | 46.48 | 22.34 | 50.56 | 15.25 |
The cash conversion cycle of SunCoke Energy Inc has fluctuated over the past five years. In 2023, the company's cash conversion cycle decreased to 18.09 days from 23.01 days in 2022, indicating an improvement in the efficiency of converting its investments in inventory and accounts receivable into cash. This suggests that SunCoke Energy Inc has been able to manage its working capital more effectively in the most recent year.
Comparing the data for 2023 with previous years, the cash conversion cycle was higher in 2022 and 2020 but lower in 2021 and 2019. This variability could be due to changes in the company's inventory management, accounts receivable collection, or accounts payable payment practices during these years.
An important consideration is that a shorter cash conversion cycle generally indicates more efficient operations and better utilization of resources. By effectively managing the components of its working capital, SunCoke Energy Inc can generate cash more quickly from its operating activities, which can have positive implications for its financial health and ability to fund growth initiatives.