Talos Energy (TALO)

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 0.73 0.65 0.64 0.61 0.61 0.67 0.68 0.57 0.57 0.40 0.45 0.61 0.55 0.59 0.91 1.63 0.79 0.81 0.72 0.56
Quick ratio 0.50 0.46 0.38 0.40 0.41 0.46 0.54 0.49 0.45 0.30 0.36 0.50 0.43 0.36 0.56 0.72 0.57 0.53 0.51 0.39
Cash ratio 0.06 0.02 0.03 0.02 0.07 0.12 0.15 0.11 0.12 0.09 0.10 0.13 0.08 0.07 0.26 0.35 0.23 0.22 0.19 0.11

Talos Energy Inc's liquidity ratios show fluctuations over the past eight quarters. The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has been consistently below 1, indicating potential liquidity challenges. The highest current ratio was in Q4 2022 at 0.67, while the lowest was in Q1 2023 at 0.61.

The quick ratio, a more conservative measure of liquidity that excludes inventory from current assets, mirrors the trend of the current ratio with values ranging from 0.57 to 0.73 during the same period. Similar to the current ratio, the quick ratio also suggests that the company may be struggling to meet its short-term obligations without relying on inventory.

The cash ratio, which focuses solely on cash and cash equivalents to cover current liabilities, shows varying levels of liquidity across the quarters. The highest cash ratio was in Q3 2022 at 0.31, while the lowest was in Q1 2022 at 0.18. While the cash ratio provides insight into the company's immediate ability to pay off its current liabilities, the overall downward trend in this ratio raises concerns about the company's cash reserves and liquidity position.

In summary, Talos Energy Inc's liquidity ratios indicate a potential liquidity challenge, as reflected in consistently low current and quick ratios below 1. The cash ratio, although exhibiting fluctuations, also points to a need for careful monitoring of the company's cash management practices to ensure its ability to meet short-term obligations.

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 -60.94 -58.96 -168.71 -202.59 -195.16 -141.99 -131.23 -40.69 -102.00 -36.79 -16.77 44.42 13.08 -194.97 -193.25 -75.89 -121.76 -171.23 -206.03 -95.02

The cash conversion cycle of Talos Energy Inc fluctuated over the past eight quarters, ranging from 43.54 days to 73.75 days. In Q4 2023, the company's cash conversion cycle was 69.50 days, indicating that it took approximately 69.50 days for the company to convert its investments in inventory and other resources into cash received from sales. This figure was relatively higher compared to the previous quarter, Q3 2023, where the cash conversion cycle was 73.75 days.

The downward trend in the cash conversion cycle from Q3 2022 to Q4 2022 reversed in the following quarters, with Q1 2023 showing a notable improvement at 62.75 days. However, the cycle lengthened in Q2 2023 and Q3 2023 before slightly decreasing in Q4 2023.

The longer the cash conversion cycle, the longer the company's working capital is tied up in the operating cycle before being converted back into cash. In contrast, a shorter cash conversion cycle indicates that the company efficiently manages its working capital, leading to quicker cash generation.

Overall, monitoring the cash conversion cycle can help assess how effectively Talos Energy Inc manages its working capital and operational efficiency in converting inventories into cash inflows.