Warner Music Group (WMG)

Liquidity ratios

Mar 31, 2024 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
Current ratio 0.69 0.70 0.68 0.70 0.69 0.70 0.64 0.61 0.61 0.60 0.60 0.60 0.63 0.63 0.62 0.63 0.58 0.59 0.60 0.62
Quick ratio 0.50 0.52 0.50 0.52 0.51 0.52 0.47 0.42 0.41 0.27 0.30 0.33 0.41 0.42 0.41 0.43 0.38 0.41 0.44 0.44
Cash ratio 0.17 0.20 0.18 0.18 0.19 0.22 0.17 0.11 0.12 -0.01 0.03 0.04 0.13 0.11 0.12 0.14 0.10 0.10 0.16 0.15

Warner Music Group's liquidity ratios show some fluctuations over the time period provided. The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, ranged from 0.58 to 0.70. The trend in the current ratio fluctuated around 0.60, indicating that the company may have struggled at times to meet its short-term obligations.

The quick ratio, a measure of the company's ability to cover immediate liabilities with its most liquid assets, ranged from 0.27 to 0.52. This ratio showed a similar trend to the current ratio, reflecting challenges in covering short-term obligations with liquid assets.

The cash ratio, which indicates the proportion of immediate liabilities that could be covered by cash and cash equivalents, ranged from -0.01 to 0.22. The negative cash ratio in one period suggests that the company had more immediate liabilities than cash on hand, which could indicate a potential liquidity issue.

Overall, Warner Music Group's liquidity ratios suggest that the company may have faced challenges in managing its short-term obligations and ensuring it had enough liquid assets to cover its immediate liabilities during the period analyzed.

Additional liquidity measure

Mar 31, 2024 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
Cash conversion cycle days 56.53 61.92 57.20 59.73 52.09 54.54 48.47 48.45 41.81 47.17 42.06 48.34 48.45 60.00 48.66 48.69 46.46 59.09 46.73 49.14

The cash conversion cycle of Warner Music Group has fluctuated over the past few reporting periods, indicating varying efficiency in managing its working capital. The company's cash conversion cycle ranged from a low of 41.81 days to a high of 61.92 days, with an average of approximately 51 days during the period under review.

A longer cash conversion cycle signifies that Warner Music Group takes more time to convert its investments in inventory and accounts receivable into cash. This could suggest inefficiencies in inventory management or slower collections from customers, which may impact the company's liquidity and working capital requirements.

On the other hand, a shorter cash conversion cycle indicates that the company is able to quickly convert its resources into cash, potentially improving its liquidity position and operational efficiency. It is essential for Warner Music Group to focus on optimizing its cash conversion cycle to strike a balance between managing its working capital effectively and ensuring sufficient liquidity for its operations.