Advanced Drainage Systems Inc (WMS)
Cash ratio
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 490,163 | 217,128 | 20,125 | 195,009 | 174,233 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 439,622 | 378,802 | 391,241 | 318,270 | 238,213 |
| Cash ratio | 1.11 | 0.57 | 0.05 | 0.61 | 0.73 |
March 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($490,163K
+ $—K)
÷ $439,622K
= 1.11
The cash ratio of Advanced Drainage Systems Inc has shown fluctuations over the past five years, indicating variations in the company's liquidity position.
In 2024, the cash ratio stands at 1.11, suggesting that the company has $1.11 in cash and cash equivalents for every dollar of current liabilities. This indicates an improvement in liquidity compared to the previous year.
The cash ratio was significantly lower in 2023 at 0.57, indicating that the company had only $0.57 in cash and cash equivalents for each dollar of current liabilities. This could signal potential liquidity challenges.
In 2022, the cash ratio was at a very low level of 0.05, highlighting a concerning liquidity position where the company had minimal cash available to cover its short-term obligations.
On the other hand, the cash ratios in 2021 and 2020 were 0.61 and 0.73, respectively. These figures suggest a better liquidity position compared to 2022 but show slight fluctuations in the company's ability to cover its short-term liabilities with available cash.
Overall, the trend in Advanced Drainage Systems Inc's cash ratio indicates fluctuations in liquidity over the years, with improvements in 2024 compared to the previous years. It is essential for the company to maintain a healthy cash ratio to ensure it can meet its short-term obligations effectively.