General Mills Inc. (NYSE:GIS)

The financial data over the 15-year period reveals several notable trends in the company's short-term financial health and liquidity management.

Current Assets

Current assets demonstrated a generally positive trajectory from 2005 through 2019. Starting at approximately US$3.05 billion in 2005, current assets increased with some fluctuations, peaking at about US$4.29 billion in 2013. Although there were occasional declines, such as between 2013 and 2015, the overall trend indicates growth in available short-term resources, ending at approximately US$4.19 billion in 2019.

Current Liabilities

Current liabilities exhibited more volatility with a less consistent pattern. They initially rose sharply from about US$4.18 billion in 2005 to a peak of approximately US$6.14 billion in 2006, then decreased steadily until around 2009, reaching roughly US$3.61 billion. After 2009, liabilities fluctuated significantly, with a marked increase beginning in 2012, culminating in a peak of about US$7.34 billion in 2018 before slightly declining to US$7.09 billion in 2019. This increase in current liabilities in later years suggests a growing short-term obligation burden.

Current Ratio

The current ratio, a key indicator of liquidity, displayed considerable variation and a generally downward trend from 2005 to 2019. The ratio started below 1 at 0.73 in 2005, dipped to a low of 0.52 in both 2006 and 2007, indicating limited short-term liquidity. It improved to a peak of 1.07 in 2011, demonstrating relatively improved ability to cover short-term obligations with current assets. However, after that peak, the ratio declined steadily to 0.59 by 2019, well below the generally acceptable threshold of 1, signaling potential liquidity pressures or tighter working capital conditions in recent years.

In summary, while current assets have grown over the period analyzed, the simultaneous and more pronounced increase in current liabilities, particularly after 2011, has pressured the current ratio downward. This suggests that despite higher asset levels, the company's ability to meet short-term obligations has become more constrained over time. The consistent current ratio below 1 in recent years may warrant further examination of liquidity management and the structure of current liabilities to ensure continued operational stability.