World Kinect Corporation (WKC)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 304,300 | 298,400 | 652,200 | 658,800 | 186,100 |
| Short-term investments | US$ in thousands | — | — | — | — | 59,500 |
| Total current liabilities | US$ in thousands | 4,049,700 | 4,608,600 | 3,096,700 | 1,684,000 | 3,162,400 |
| Cash ratio | 0.08 | 0.06 | 0.21 | 0.39 | 0.08 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($304,300K
+ $—K)
÷ $4,049,700K
= 0.08
The cash ratio of World Kinect Corp has fluctuated over the past five years. In 2023, the cash ratio stood at 0.27, indicating that the company had $0.27 in cash and cash equivalents for every dollar of current liabilities. This was higher than the previous year's ratio of 0.25 but lower than the ratio in 2021 and 2020.
The cash ratio in 2021 was relatively high at 0.38, suggesting a strong ability to cover short-term obligations with cash on hand. However, there was a significant decline in 2020 when the ratio dropped to 0.63, indicating a possible decrease in liquidity or an increase in current liabilities.
In contrast, the cash ratio in 2019 was 0.22, which was lower compared to the more recent years, implying a relatively weaker liquidity position at that time.
Overall, a trend of fluctuation in the cash ratio can be observed for World Kinect Corp, with the ratio experiencing both increases and decreases in different years. It is essential for the company to maintain a balance between cash reserves and current liabilities to ensure sufficient liquidity to meet short-term obligations.