UGI Corporation (UGI)

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 0.98 0.90 0.98 1.21 1.02 1.56 1.70 1.66 1.33 1.42 1.40 1.26 1.04 0.88 0.95 0.89 0.81 0.77 1.08 1.23
Quick ratio 0.59 0.51 0.60 0.81 0.58 0.68 0.98 1.01 0.75 0.81 0.89 0.93 0.73 0.61 0.69 0.62 0.56 0.54 0.82 0.97
Cash ratio 0.09 0.11 0.12 0.14 0.09 0.17 0.32 0.29 0.13 0.37 0.32 0.23 0.20 0.19 0.29 0.14 0.14 0.22 0.33 0.28

The current ratio measures UGI Corp.'s ability to cover its short-term liabilities with its current assets. A current ratio below 1 indicates a potential liquidity issue, as seen in Q4 2023 and Q1 2024. However, the ratio has improved since then.

The quick ratio, also known as the acid-test ratio, provides a more stringent assessment of liquidity since it excludes inventory from current assets. UGI Corp.'s quick ratio is consistently below 1, indicating that the company may have difficulty meeting its short-term obligations with its most liquid assets.

The cash ratio, which is the most conservative liquidity ratio, shows UGI Corp.'s ability to cover its current liabilities with cash and cash equivalents alone. The declining trend in the cash ratio suggests that the company may have limited reserves to meet immediate obligations without relying on other current assets.

Overall, UGI Corp.'s liquidity ratios indicate some challenges in meeting short-term obligations, especially in Q4 2023 and Q1 2024. Continuous monitoring of liquidity position is essential to ensure the company can meet its financial obligations without disruptions.

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 38.44 30.68 33.58 44.46 42.42 35.09 32.22 39.81 42.25 16.77 29.29 43.45 33.26 20.07 20.67 27.71 1.88 -17.32 -55.38 -775.71

The cash conversion cycle for UGI Corp. has shown some fluctuations over the past eight quarters. The company's cash conversion cycle, which represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales, ranged from 26.79 days to 44.54 days during this period.

In the most recent quarter, Q1 2024, the cash conversion cycle was 35.83 days, indicating a moderate efficiency in managing its working capital compared to the previous quarter, Q4 2023, when it was 29.24 days. This increase suggests a potential slowdown in converting inventory into sales and collecting cash from customers.

Looking back over the quarters, the company experienced a peak in its cash conversion cycle in Q2 2023, with 44.54 days, indicating a longer period to convert investments into cash inflows compared to the lower cycle in Q3 2022, when it was at 26.79 days.

Overall, UGI Corp. should focus on effectively managing its inventory levels, improving its accounts receivable collection process, and optimizing its accounts payable to shorten the cash conversion cycle. By reducing this cycle, the company can free up cash flow, improve liquidity, and enhance overall financial performance.