Analysis of Debt
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- Income Statement
- Common-Size Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Solvency Ratios
- Capital Asset Pricing Model (CAPM)
- Dividend Discount Model (DDM)
- Net Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Total Asset Turnover since 2005
- Price to Book Value (P/BV) since 2005
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Total Debt (Carrying Amount)
Biogen Inc., balance sheet: debt
US$ in thousands
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The analysis of the annual reported debt data reveals several key trends and fluctuations in the company's notes payable over the period from 2017 to 2021.
- Current Portion of Notes Payable
-
This category exhibits significant volatility. The value was relatively low at 3,200 thousand US dollars in 2017, rose sharply to 1,495,800 thousand in 2019, and then decreased to 999,100 thousand by the end of 2021. Notably, data for 2018 and 2020 are missing, which limits a continuous trend analysis for this item.
- Notes Payable, Excluding Current Portion
-
The long-term debt portion maintained a high level throughout the period but showed fluctuations. It started at 5,935,000 thousand US dollars in 2017, remained essentially stable in 2018, then decreased noticeably to 4,459,000 thousand in 2019. In 2020, there was a substantial increase to 7,426,200 thousand, followed by a reduction to 6,274,000 thousand in 2021. This pattern suggests adjustments in the long-term debt structure, possibly related to refinancing or changes in borrowing strategies.
- Total Notes Payable, Including Current Portion
-
The total carrying amount of notes payable generally mirrored the trends seen in the individual components. It held stable around 5,938,200 thousand in 2017 and 5,936,500 thousand in 2018, increased slightly to 5,954,800 thousand in 2019, and surged to 7,426,200 thousand in 2020 before a modest decline to 7,273,100 thousand in 2021. The 2020 peak indicates a significant increase in overall debt obligations during that year.
In summary, the company's debt structure shows a pattern of significant short-term fluctuations combined with variable long-term debt levels. The notable increase in total notes payable in 2020 suggests increased borrowing, possibly to support strategic initiatives or cover operational needs during that period. The partial reduction in debt levels in 2021 could indicate efforts to deleverage or optimize the capital structure. The missing data points, particularly in the current portion of notes payable, limit the ability to fully assess year-over-year changes for some periods.
Total Debt (Fair Value)
| Dec 31, 2021 | |
|---|---|
| Selected Financial Data (US$ in thousands) | |
| Total notes payable, including current portion (fair value) | |
| Financial Ratio | |
| Debt, fair value to carrying amount ratio | |
Based on: 10-K (reporting date: 2021-12-31).
Weighted-average Interest Rate on Debt
Weighted-average interest rate on notes payable:
| Interest rate | Debt amount1 | Interest rate × Debt amount | Weighted-average interest rate2 |
|---|---|---|---|
| Total | |||
Based on: 10-K (reporting date: 2021-12-31).
1 US$ in thousands
2 Weighted-average interest rate = 100 × ÷ =
Interest Costs Incurred
Biogen Inc., interest costs incurred
US$ in thousands
| 12 months ended: | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest expense | |||||||||||
| Capitalized interest costs related to construction in progress | |||||||||||
| Interest costs incurred |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Interest Expense Trends
- The interest expense displayed a decreasing trend from 2017 to 2019, declining from 250,800 thousand US dollars in 2017 to 187,400 thousand US dollars in 2019. Subsequently, the interest expense increased to 222,500 thousand US dollars in 2020, and further rose to 253,600 thousand US dollars in 2021, nearly returning to the 2017 level.
- Capitalized Interest Costs Related to Construction in Progress
- This category exhibited a growth pattern from 2017 through 2019, starting at 30,700 thousand US dollars in 2017 and peaking at 68,800 thousand US dollars in 2019. After reaching this peak, capitalized interest costs declined to 65,200 thousand US dollars in 2020 and dropped more sharply to 36,300 thousand US dollars in 2021.
- Total Interest Costs Incurred
- The total interest costs incurred initially decreased from 281,500 thousand US dollars in 2017 to 254,600 thousand US dollars in 2018. The value slightly increased to 256,200 thousand US dollars in 2019, followed by a notable rise to 287,700 thousand US dollars in 2020, and a marginal increase to 289,900 thousand US dollars in 2021.
- Overall Analysis
- The data suggests a dynamic between interest expense and capitalized interest costs. While interest expense generally declined initially, capitalized interest costs increased over the same period, which indicates a shift in how interest-related costs were allocated. The subsequent rise in interest expense combined with the decrease in capitalized interest costs after 2019 may indicate a change in construction project activity or capitalization policy. The total interest costs incurred remained relatively stable with a slight upward trajectory in the later years, reflecting an overall increase in total financing costs over the five-year period.
Adjusted Interest Coverage Ratio
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
2021 Calculations
1 Interest coverage ratio (without capitalized interest) = EBIT ÷ Interest expense
= ÷ =
2 Adjusted interest coverage ratio (with capitalized interest) = EBIT ÷ Interest costs incurred
= ÷ =
- Interest Coverage Ratio (without capitalized interest)
- There was a significant increase in the interest coverage ratio from 21.45 in 2017 to a peak of 38.6 in 2019. This indicates an improving ability to meet interest obligations during this period. However, after 2019, the ratio declined sharply, dropping to 23.71 in 2020 and further to 8.02 in 2021. This trend suggests a weakening in the company's capacity to cover interest expenses in the most recent years.
- Adjusted Interest Coverage Ratio (with capitalized interest)
- The adjusted ratio followed a similar pattern, increasing from 19.11 in 2017 to 28.24 in 2019, reflecting an improving financial position when considering capitalized interest. Subsequently, the ratio decreased markedly to 18.34 in 2020 and then to 7.02 in 2021, indicating a pronounced reduction in coverage capacity under the adjusted metric as well.
- Overall Analysis
- Both coverage ratios exhibited strong growth from 2017 through 2019, indicating an improving financial health relative to interest obligations in that timeframe. The sharp decline beginning in 2020 and continuing into 2021 points to increased financial risk or reduced operational profitability affecting the company's ability to service interest costs. The more pronounced drop in 2021 suggests this trend became more severe, potentially signaling challenges in cash flow generation or increased interest burdens.