Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
The analysis of the financial leverage and debt-related ratios over the five-year period reveals significant changes in the company’s capital structure and its ability to cover financial obligations.
- Debt to Equity
- The debt to equity ratio increased notably from 2.51 in 2019 to a peak of 10.7 in 2022, indicating a substantial rise in debt relative to shareholders' equity. In 2023, this ratio decreased somewhat to 8.82, suggesting a modest reduction in leverage but still at an elevated level compared to the beginning of the period. The inclusion of operating lease liabilities produces very similar trends, with slightly higher ratios throughout the years.
- Debt to Capital
- The debt to capital ratio rose steadily from 0.72 in 2019 to a high of 0.91 in 2022, then remained almost stable at 0.9 in 2023. This trend reflects an increasing proportion of debt financing in the overall capital structure. Including operating lease liabilities has minimal impact on this ratio, maintaining a similar upward trajectory and plateau.
- Debt to Assets
- This ratio moved upward from 0.53 in 2019 to 0.68 in 2022, showing a growing reliance on debt relative to total assets. A slight decrease to 0.66 in 2023 suggests some deleveraging or asset growth. When operating lease liabilities are included, the pattern and values are comparable, indicating leases are a consistent part of the debt profile.
- Financial Leverage
- Financial leverage, which measures the use of debt to finance assets, increased dramatically from 4.71 in 2019 to 15.85 in 2022, pointing to a rising use of debt. The subsequent year saw a reduction to 13.28, still reflecting a highly leveraged position but indicating some mitigation of risk relative to the prior year.
- Interest Coverage
- The interest coverage ratio improved from 1.64 in 2019 to 2.64 in 2022, showing enhanced ability to meet interest payments through operating earnings. However, this ratio declined to 2.32 in 2023, indicating some weakening in this coverage though remaining above the earlier years.
- Fixed Charge Coverage
- This ratio follows a similar trend to interest coverage, increasing from 1.58 in 2019 to 2.48 in 2022, signaling better capacity to cover fixed financial charges. The decline to 2.2 in 2023 points to a decrease in coverage yet still demonstrates improvement compared to 2019.
Overall, the company’s financial structure experienced a marked increase in leverage from 2019 through 2022, reaching historically high levels, followed by a modest deleveraging in 2023. Despite elevated debt levels, coverage ratios indicate that earnings generally improved their sufficiency to meet interest and fixed charges up to 2022, with some recent erosion in such coverage in 2023. The relative stability of ratios when including operating lease liabilities suggests these liabilities form a consistent component of the overall debt profile.
Debt Ratios
Coverage Ratios
Debt to Equity
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Current portion of long-term debt | 2,000) | 1,510) | 2,997) | 1,008) | 3,500) | |
Long-term debt, less current portion | 95,777) | 96,093) | 88,564) | 81,744) | 75,578) | |
Total debt | 97,777) | 97,603) | 91,561) | 82,752) | 79,078) | |
Total Charter shareholders’ equity | 11,086) | 9,119) | 14,050) | 23,805) | 31,445) | |
Solvency Ratio | ||||||
Debt to equity1 | 8.82 | 10.70 | 6.52 | 3.48 | 2.51 | |
Benchmarks | ||||||
Debt to Equity, Competitors2 | ||||||
Alphabet Inc. | 0.05 | 0.06 | 0.06 | 0.07 | — | |
Comcast Corp. | 1.17 | 1.17 | 0.99 | 1.15 | — | |
Meta Platforms Inc. | 0.12 | 0.08 | 0.00 | 0.00 | — | |
Netflix Inc. | 0.71 | 0.69 | 0.97 | 1.47 | — | |
Take-Two Interactive Software Inc. | 0.34 | 0.00 | 0.00 | 0.00 | — | |
Walt Disney Co. | 0.47 | 0.51 | 0.62 | 0.71 | 0.53 | |
Debt to Equity, Sector | ||||||
Media & Entertainment | 0.30 | 0.31 | 0.31 | 0.36 | — | |
Debt to Equity, Industry | ||||||
Communication Services | 0.62 | 0.65 | 0.65 | 0.67 | — |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to equity = Total debt ÷ Total Charter shareholders’ equity
= 97,777 ÷ 11,086 = 8.82
2 Click competitor name to see calculations.
The financial data over the five-year period exhibits clear trends in the company's capital structure and leverage position. Total debt has consistently increased from US$ 79,078 million at the end of 2019 to US$ 97,777 million at the end of 2023. This steady rise indicates a growing reliance on debt financing.
Conversely, total shareholders' equity displays a marked declining trend from US$ 31,445 million in 2019 to a low point of US$ 9,119 million in 2022, with a slight recovery to US$ 11,086 million in 2023. The significant drop in equity reveals potential challenges in capital retention or earnings retention and suggests a deterioration in the company's net asset base during the period.
- Debt to Equity Ratio
- The debt to equity ratio has escalated dramatically, beginning at 2.51 in 2019 and reaching a peak of 10.7 in 2022 before slightly decreasing to 8.82 in 2023. This sharp increase primarily reflects the compounding effect of rising debt and shrinking equity, highlighting an increased leverage risk and potentially higher financial vulnerability.
Overall, these trends suggest an intensified dependence on borrowed capital relative to equity, which could impact financial stability and borrowing costs. The slight improvement in equity and reduction in the debt to equity ratio in 2023 may indicate initial signs of stabilization, but the leverage level remains substantially elevated compared to earlier years.
Debt to Equity (including Operating Lease Liability)
Charter Communications Inc., debt to equity (including operating lease liability) calculation, comparison to benchmarks
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Current portion of long-term debt | 2,000) | 1,510) | 2,997) | 1,008) | 3,500) | |
Long-term debt, less current portion | 95,777) | 96,093) | 88,564) | 81,744) | 75,578) | |
Total debt | 97,777) | 97,603) | 91,561) | 82,752) | 79,078) | |
Operating lease liabilities, current portion (included within Accrued and other current liabilities) | 290) | 295) | 269) | 235) | 214) | |
Operating lease liabilities, long-term portion (included within Other long-term liabilities) | 1,128) | 1,083) | 1,182) | 1,110) | 979) | |
Total debt (including operating lease liability) | 99,195) | 98,981) | 93,012) | 84,097) | 80,271) | |
Total Charter shareholders’ equity | 11,086) | 9,119) | 14,050) | 23,805) | 31,445) | |
Solvency Ratio | ||||||
Debt to equity (including operating lease liability)1 | 8.95 | 10.85 | 6.62 | 3.53 | 2.55 | |
Benchmarks | ||||||
Debt to Equity (including Operating Lease Liability), Competitors2 | ||||||
Alphabet Inc. | 0.11 | 0.12 | 0.11 | 0.13 | — | |
Comcast Corp. | 1.25 | 1.26 | 1.06 | 1.20 | — | |
Meta Platforms Inc. | 0.25 | 0.22 | 0.12 | 0.09 | — | |
Netflix Inc. | 0.82 | 0.81 | 1.14 | 1.67 | — | |
Take-Two Interactive Software Inc. | 0.39 | 0.07 | 0.06 | 0.07 | — | |
Walt Disney Co. | 0.51 | 0.55 | 0.66 | 0.75 | 0.53 | |
Debt to Equity (including Operating Lease Liability), Sector | ||||||
Media & Entertainment | 0.37 | 0.39 | 0.38 | 0.42 | — | |
Debt to Equity (including Operating Lease Liability), Industry | ||||||
Communication Services | 0.75 | 0.80 | 0.79 | 0.80 | — |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Total Charter shareholders’ equity
= 99,195 ÷ 11,086 = 8.95
2 Click competitor name to see calculations.
- Total Debt (including operating lease liability)
- The total debt shows a consistent upward trend from 2019 to 2023. Starting at $80,271 million in 2019, the debt increased steadily each year, reaching $99,195 million in 2023. This represents a notable growth in financial obligations over the five-year period.
- Total Charter Shareholders’ Equity
- Shareholders' equity experienced a significant decline from 2019 through 2022. It fell from $31,445 million in 2019 to a low of $9,119 million in 2022. In 2023, there was a slight recovery to $11,086 million; however, equity remains substantially lower compared to the 2019 level.
- Debt to Equity Ratio (including operating lease liability)
- The debt to equity ratio increased markedly from 2019 to 2022, indicating a growing imbalance between debt and shareholders’ equity. The ratio climbed from 2.55 in 2019 to a peak of 10.85 in 2022, reflecting increased leverage and financial risk. In 2023, the ratio decreased to 8.95, suggesting a modest improvement in the capital structure but still representing a high leverage level relative to earlier years.
Debt to Capital
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Current portion of long-term debt | 2,000) | 1,510) | 2,997) | 1,008) | 3,500) | |
Long-term debt, less current portion | 95,777) | 96,093) | 88,564) | 81,744) | 75,578) | |
Total debt | 97,777) | 97,603) | 91,561) | 82,752) | 79,078) | |
Total Charter shareholders’ equity | 11,086) | 9,119) | 14,050) | 23,805) | 31,445) | |
Total capital | 108,863) | 106,722) | 105,611) | 106,557) | 110,523) | |
Solvency Ratio | ||||||
Debt to capital1 | 0.90 | 0.91 | 0.87 | 0.78 | 0.72 | |
Benchmarks | ||||||
Debt to Capital, Competitors2 | ||||||
Alphabet Inc. | 0.05 | 0.06 | 0.06 | 0.06 | — | |
Comcast Corp. | 0.54 | 0.54 | 0.50 | 0.53 | — | |
Meta Platforms Inc. | 0.11 | 0.08 | 0.00 | 0.00 | — | |
Netflix Inc. | 0.41 | 0.41 | 0.49 | 0.60 | — | |
Take-Two Interactive Software Inc. | 0.25 | 0.00 | 0.00 | 0.00 | — | |
Walt Disney Co. | 0.32 | 0.34 | 0.38 | 0.41 | 0.35 | |
Debt to Capital, Sector | ||||||
Media & Entertainment | 0.23 | 0.24 | 0.24 | 0.27 | — | |
Debt to Capital, Industry | ||||||
Communication Services | 0.38 | 0.39 | 0.39 | 0.40 | — |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to capital = Total debt ÷ Total capital
= 97,777 ÷ 108,863 = 0.90
2 Click competitor name to see calculations.
The financial data reveals a clear upward trend in total debt from 2019 to 2023. Total debt increased steadily each year, rising from US$79,078 million at the end of 2019 to US$97,777 million by the end of 2023. This represents an overall increase of approximately 23.7% over the five-year period.
In contrast, total capital showed less volatility. It initially declined from US$110,523 million in 2019 to US$106,557 million in 2020 and 2021, then gradually increased again to US$108,863 million by the end of 2023. Despite this partial recovery, total capital at the end of 2023 remained slightly below the 2019 level, indicating a relatively stable but mildly decreasing trend over the period.
The debt to capital ratio exhibits a marked increase, reflecting the changes observed in total debt and total capital. The ratio rose from 0.72 at the end of 2019 to 0.90 by the end of 2023, with a notable acceleration between 2020 and 2022. This upward movement suggests that debt has become a more significant component of the company’s capital structure, indicating a higher leverage position.
- Summary of key trends:
- - Total debt increased consistently by nearly 24% over five years.
- - Total capital experienced a slight decline initially, followed by a modest recovery, resulting in an overall stable level with mild downward tendency.
- - The debt to capital ratio increased substantially, reflecting greater reliance on debt financing and elevated leverage.
Overall, the data suggests a strategic shift towards increased debt financing relative to total capital, which may have implications for the company’s financial risk profile and cost of capital moving forward.
Debt to Capital (including Operating Lease Liability)
Charter Communications Inc., debt to capital (including operating lease liability) calculation, comparison to benchmarks
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Current portion of long-term debt | 2,000) | 1,510) | 2,997) | 1,008) | 3,500) | |
Long-term debt, less current portion | 95,777) | 96,093) | 88,564) | 81,744) | 75,578) | |
Total debt | 97,777) | 97,603) | 91,561) | 82,752) | 79,078) | |
Operating lease liabilities, current portion (included within Accrued and other current liabilities) | 290) | 295) | 269) | 235) | 214) | |
Operating lease liabilities, long-term portion (included within Other long-term liabilities) | 1,128) | 1,083) | 1,182) | 1,110) | 979) | |
Total debt (including operating lease liability) | 99,195) | 98,981) | 93,012) | 84,097) | 80,271) | |
Total Charter shareholders’ equity | 11,086) | 9,119) | 14,050) | 23,805) | 31,445) | |
Total capital (including operating lease liability) | 110,281) | 108,100) | 107,062) | 107,902) | 111,716) | |
Solvency Ratio | ||||||
Debt to capital (including operating lease liability)1 | 0.90 | 0.92 | 0.87 | 0.78 | 0.72 | |
Benchmarks | ||||||
Debt to Capital (including Operating Lease Liability), Competitors2 | ||||||
Alphabet Inc. | 0.10 | 0.10 | 0.10 | 0.11 | — | |
Comcast Corp. | 0.56 | 0.56 | 0.52 | 0.55 | — | |
Meta Platforms Inc. | 0.20 | 0.18 | 0.10 | 0.08 | — | |
Netflix Inc. | 0.45 | 0.45 | 0.53 | 0.63 | — | |
Take-Two Interactive Software Inc. | 0.28 | 0.06 | 0.05 | 0.07 | — | |
Walt Disney Co. | 0.34 | 0.35 | 0.40 | 0.43 | 0.35 | |
Debt to Capital (including Operating Lease Liability), Sector | ||||||
Media & Entertainment | 0.27 | 0.28 | 0.28 | 0.30 | — | |
Debt to Capital (including Operating Lease Liability), Industry | ||||||
Communication Services | 0.43 | 0.44 | 0.44 | 0.44 | — |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 99,195 ÷ 110,281 = 0.90
2 Click competitor name to see calculations.
- Total debt (including operating lease liability)
- The total debt shows a consistent upward trend from 2019 to 2023. It increased from 80,271 million US dollars in 2019 to 99,195 million US dollars in 2023, representing an overall increase of approximately 23.5%. The growth rate appeared to slow somewhat between 2022 and 2023, with the debt level plateauing near 99,000 million US dollars.
- Total capital (including operating lease liability)
- Total capital experienced a slight decline from 111,716 million US dollars in 2019 to 107,062 million US dollars in 2021. Afterward, capital levels increased modestly, reaching 110,281 million US dollars in 2023. Overall, the total capital remained relatively stable over the five-year period, fluctuating within a narrow range around 108,000 to 111,700 million US dollars.
- Debt to capital (including operating lease liability) ratio
- The debt to capital ratio exhibits a clear rising pattern from 0.72 in 2019 to a peak of 0.92 in 2022, before a slight decrease to 0.90 in 2023. This upward trend indicates increasing leverage over the period, reflecting a greater proportion of debt within the total capital structure. The ratio approaching and slightly retreating from the 0.90 level suggests a relatively high dependency on debt financing, with some stabilization occurring in the most recent year.
- Overall Analysis
- The data indicates an increasing reliance on debt as a component of the company’s capital structure, with total debt rising steadily and the debt to capital ratio moving upward. Despite fluctuations in total capital, the company has maintained a generally consistent capital base. The gradual increase in leverage could imply higher financial risk, although the slight reduction in the debt to capital ratio in the last period may reflect efforts to balance the implications of high debt levels.
Debt to Assets
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Current portion of long-term debt | 2,000) | 1,510) | 2,997) | 1,008) | 3,500) | |
Long-term debt, less current portion | 95,777) | 96,093) | 88,564) | 81,744) | 75,578) | |
Total debt | 97,777) | 97,603) | 91,561) | 82,752) | 79,078) | |
Total assets | 147,193) | 144,523) | 142,491) | 144,206) | 148,188) | |
Solvency Ratio | ||||||
Debt to assets1 | 0.66 | 0.68 | 0.64 | 0.57 | 0.53 | |
Benchmarks | ||||||
Debt to Assets, Competitors2 | ||||||
Alphabet Inc. | 0.04 | 0.04 | 0.04 | 0.05 | — | |
Comcast Corp. | 0.37 | 0.37 | 0.34 | 0.38 | — | |
Meta Platforms Inc. | 0.08 | 0.06 | 0.00 | 0.00 | — | |
Netflix Inc. | 0.30 | 0.30 | 0.35 | 0.42 | — | |
Take-Two Interactive Software Inc. | 0.19 | 0.00 | 0.00 | 0.00 | — | |
Walt Disney Co. | 0.23 | 0.24 | 0.27 | 0.29 | 0.24 | |
Debt to Assets, Sector | ||||||
Media & Entertainment | 0.17 | 0.17 | 0.17 | 0.19 | — | |
Debt to Assets, Industry | ||||||
Communication Services | 0.26 | 0.26 | 0.27 | 0.27 | — |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to assets = Total debt ÷ Total assets
= 97,777 ÷ 147,193 = 0.66
2 Click competitor name to see calculations.
- Total Debt
- The total debt exhibited a consistent upward trend from 2019 to 2023. The debt increased from approximately $79.1 billion in 2019 to nearly $97.8 billion by the end of 2023. This represents a sizable increase of around 23.7% over the five-year period, indicating a growing reliance on debt financing.
- Total Assets
- Total assets initially declined from $148.2 billion in 2019 to $142.5 billion in 2021. Following this decrease, the assets began to recover gradually, reaching $147.2 billion by the end of 2023. Despite fluctuations, the asset base remained relatively stable with a marginal overall decrease of about 0.7% over the five years.
- Debt to Assets Ratio
- The debt to assets ratio steadily increased from 0.53 in 2019 to 0.68 in 2022, reflecting a growing proportion of debt relative to the asset base. By 2023, there was a slight decrease to 0.66, indicating a minor improvement but still maintaining a higher leverage compared to earlier years. The upward trend in this ratio underscores an increasing financial leverage and potential elevated risk associated with the company’s capital structure.
Debt to Assets (including Operating Lease Liability)
Charter Communications Inc., debt to assets (including operating lease liability) calculation, comparison to benchmarks
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Current portion of long-term debt | 2,000) | 1,510) | 2,997) | 1,008) | 3,500) | |
Long-term debt, less current portion | 95,777) | 96,093) | 88,564) | 81,744) | 75,578) | |
Total debt | 97,777) | 97,603) | 91,561) | 82,752) | 79,078) | |
Operating lease liabilities, current portion (included within Accrued and other current liabilities) | 290) | 295) | 269) | 235) | 214) | |
Operating lease liabilities, long-term portion (included within Other long-term liabilities) | 1,128) | 1,083) | 1,182) | 1,110) | 979) | |
Total debt (including operating lease liability) | 99,195) | 98,981) | 93,012) | 84,097) | 80,271) | |
Total assets | 147,193) | 144,523) | 142,491) | 144,206) | 148,188) | |
Solvency Ratio | ||||||
Debt to assets (including operating lease liability)1 | 0.67 | 0.68 | 0.65 | 0.58 | 0.54 | |
Benchmarks | ||||||
Debt to Assets (including Operating Lease Liability), Competitors2 | ||||||
Alphabet Inc. | 0.07 | 0.08 | 0.08 | 0.09 | — | |
Comcast Corp. | 0.39 | 0.39 | 0.37 | 0.40 | — | |
Meta Platforms Inc. | 0.17 | 0.15 | 0.09 | 0.07 | — | |
Netflix Inc. | 0.35 | 0.35 | 0.41 | 0.47 | — | |
Take-Two Interactive Software Inc. | 0.22 | 0.04 | 0.03 | 0.04 | — | |
Walt Disney Co. | 0.25 | 0.26 | 0.29 | 0.31 | 0.24 | |
Debt to Assets (including Operating Lease Liability), Sector | ||||||
Media & Entertainment | 0.21 | 0.21 | 0.21 | 0.23 | — | |
Debt to Assets (including Operating Lease Liability), Industry | ||||||
Communication Services | 0.32 | 0.33 | 0.32 | 0.33 | — |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 99,195 ÷ 147,193 = 0.67
2 Click competitor name to see calculations.
- Total Debt (including operating lease liability)
- The total debt amount exhibited a consistent upward trend over the five-year period. Starting at approximately 80.3 billion USD in 2019, debt increased annually, reaching nearly 99.2 billion USD by the end of 2023. The most significant increases occurred between 2020 and 2021 and then moderated slightly in subsequent years.
- Total Assets
- Total assets showed a slight downward trend from 2019 to 2021, declining from around 148.2 billion USD to 142.5 billion USD. However, the asset base stabilized and began to rise gradually again from 2021 onward, reaching approximately 147.2 billion USD by 2023. Despite fluctuations, the total asset value remained relatively stable over the entire period.
- Debt to Assets Ratio (including operating lease liability)
- The debt-to-assets ratio increased from 0.54 in 2019 to a peak of 0.68 in 2022, indicating a rising proportion of debt financing relative to the company's asset base. This ratio slightly decreased to 0.67 in 2023 but remained notably higher than the 2019 level. The trend suggests growing leverage, with debt rising faster than assets during most of the period under review.
Financial Leverage
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Total assets | 147,193) | 144,523) | 142,491) | 144,206) | 148,188) | |
Total Charter shareholders’ equity | 11,086) | 9,119) | 14,050) | 23,805) | 31,445) | |
Solvency Ratio | ||||||
Financial leverage1 | 13.28 | 15.85 | 10.14 | 6.06 | 4.71 | |
Benchmarks | ||||||
Financial Leverage, Competitors2 | ||||||
Alphabet Inc. | 1.42 | 1.43 | 1.43 | 1.44 | — | |
Comcast Corp. | 3.20 | 3.18 | 2.87 | 3.03 | — | |
Meta Platforms Inc. | 1.50 | 1.48 | 1.33 | 1.24 | — | |
Netflix Inc. | 2.37 | 2.34 | 2.81 | 3.55 | — | |
Take-Two Interactive Software Inc. | 1.75 | 1.72 | 1.81 | 1.95 | — | |
Walt Disney Co. | 2.07 | 2.14 | 2.30 | 2.41 | 2.18 | |
Financial Leverage, Sector | ||||||
Media & Entertainment | 1.80 | 1.83 | 1.82 | 1.85 | — | |
Financial Leverage, Industry | ||||||
Communication Services | 2.38 | 2.45 | 2.43 | 2.45 | — |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Financial leverage = Total assets ÷ Total Charter shareholders’ equity
= 147,193 ÷ 11,086 = 13.28
2 Click competitor name to see calculations.
- Total assets
- The total assets exhibited slight fluctuations over the five-year period, initially declining from US$148.19 billion in 2019 to approximately US$142.49 billion in 2021. Thereafter, a gradual increase occurred, reaching around US$147.19 billion in 2023. Overall, total assets remained relatively stable with minor variations, reflecting a consistent asset base.
- Total Charter shareholders’ equity
- Shareholders’ equity demonstrated a consistent downward trend from 2019 to 2022, falling significantly from US$31.45 billion to US$9.12 billion. A moderate recovery was observed in 2023, with equity rising slightly to US$11.09 billion. This pattern indicates substantial equity erosion over the period, with some signs of stabilization or modest improvement in the most recent year.
- Financial leverage
- Financial leverage increased markedly from a ratio of 4.71 in 2019 to a peak of 15.85 in 2022, indicating that the company substantially increased its debt relative to equity. In 2023, leverage declined somewhat to 13.28, yet remained significantly higher than in the earlier years. This suggests a period of heightened financial risk or increased use of debt financing, followed by a partial deleveraging in the most recent year.
- Summary of trends
- The data reflects a scenario where total assets maintained a relatively steady level, while equity decreased sharply for much of the period, leading to a significant rise in financial leverage. The increase in leverage underscores growing dependency on borrowed funds. The slight recovery in equity and decline in leverage in 2023 may indicate management’s efforts toward strengthening the capital structure or improving financial stability. Overall, the trends suggest increasing financial risk in the earlier years, with tentative moves toward mitigation in the latest year assessed.
Interest Coverage
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Net income attributable to Charter shareholders | 4,557) | 5,055) | 4,654) | 3,222) | 1,668) | |
Add: Net income attributable to noncontrolling interest | 704) | 794) | 666) | 454) | 324) | |
Add: Income tax expense | 1,593) | 1,613) | 1,068) | 626) | 439) | |
Add: Interest expense, net | 5,188) | 4,556) | 4,037) | 3,848) | 3,797) | |
Earnings before interest and tax (EBIT) | 12,042) | 12,018) | 10,425) | 8,150) | 6,228) | |
Solvency Ratio | ||||||
Interest coverage1 | 2.32 | 2.64 | 2.58 | 2.12 | 1.64 | |
Benchmarks | ||||||
Interest Coverage, Competitors2 | ||||||
Alphabet Inc. | 279.30 | 200.80 | 263.24 | 357.16 | — | |
Comcast Corp. | 6.01 | 3.38 | 5.46 | 4.07 | — | |
Meta Platforms Inc. | 107.34 | 164.74 | 3,153.27 | 2,371.00 | — | |
Netflix Inc. | 9.87 | 8.45 | 8.63 | 5.17 | — | |
Take-Two Interactive Software Inc. | -9.32 | 25.98 | 110.20 | 174.85 | — | |
Walt Disney Co. | 3.42 | 4.41 | 2.66 | -0.06 | 12.19 | |
Interest Coverage, Sector | ||||||
Media & Entertainment | 22.36 | 18.97 | 24.88 | 14.59 | — | |
Interest Coverage, Industry | ||||||
Communication Services | 10.10 | 8.52 | 11.93 | 6.53 | — |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Interest coverage = EBIT ÷ Interest expense
= 12,042 ÷ 5,188 = 2.32
2 Click competitor name to see calculations.
- Earnings before interest and tax (EBIT)
- The EBIT demonstrated a consistent upward trend from 2019 to 2022, increasing significantly from 6,228 million US dollars in 2019 to 12,018 million US dollars in 2022. However, in 2023, EBIT remained relatively stable at 12,042 million US dollars, indicating a plateau after four years of growth.
- Interest expense, net
- Net interest expense showed a steady increase throughout the five-year period, rising from 3,797 million US dollars in 2019 to 5,188 million US dollars in 2023. The increase was continuous each year, reflecting a growing burden of interest costs.
- Interest coverage ratio
- The interest coverage ratio improved significantly from 1.64 in 2019 to a peak of 2.64 in 2022, indicating enhanced ability to meet interest obligations from operating earnings. In 2023, the ratio declined to 2.32, suggesting a reduced but still relatively strong capacity to cover interest expenses compared to the earlier years.
Overall, the data reveal strong growth in operating profitability until 2022, accompanied by increasing interest expenses. Despite rising interest costs, the company maintained an improving interest coverage ratio until 2022, reflecting improving operational efficiency or earnings growth outpacing interest expense increases. The slight reduction in interest coverage in 2023 warrants attention as it may indicate a shift in financial risk or earnings stability.
Fixed Charge Coverage
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Net income attributable to Charter shareholders | 4,557) | 5,055) | 4,654) | 3,222) | 1,668) | |
Add: Net income attributable to noncontrolling interest | 704) | 794) | 666) | 454) | 324) | |
Add: Income tax expense | 1,593) | 1,613) | 1,068) | 626) | 439) | |
Add: Interest expense, net | 5,188) | 4,556) | 4,037) | 3,848) | 3,797) | |
Earnings before interest and tax (EBIT) | 12,042) | 12,018) | 10,425) | 8,150) | 6,228) | |
Add: Operating lease expenses | 506) | 482) | 463) | 439) | 428) | |
Earnings before fixed charges and tax | 12,548) | 12,500) | 10,888) | 8,589) | 6,656) | |
Interest expense, net | 5,188) | 4,556) | 4,037) | 3,848) | 3,797) | |
Operating lease expenses | 506) | 482) | 463) | 439) | 428) | |
Fixed charges | 5,694) | 5,038) | 4,500) | 4,287) | 4,225) | |
Solvency Ratio | ||||||
Fixed charge coverage1 | 2.20 | 2.48 | 2.42 | 2.00 | 1.58 | |
Benchmarks | ||||||
Fixed Charge Coverage, Competitors2 | ||||||
Alphabet Inc. | 24.36 | 22.90 | 30.80 | 21.02 | — | |
Comcast Corp. | 4.87 | 2.82 | 4.48 | 3.47 | — | |
Meta Platforms Inc. | 19.69 | 15.18 | 31.41 | 24.62 | — | |
Netflix Inc. | 5.64 | 5.00 | 5.46 | 3.65 | — | |
Take-Two Interactive Software Inc. | -4.59 | 8.17 | 16.58 | 15.32 | — | |
Walt Disney Co. | 2.71 | 3.25 | 2.07 | 0.32 | 6.94 | |
Fixed Charge Coverage, Sector | ||||||
Media & Entertainment | 11.29 | 9.54 | 13.02 | 8.32 | — | |
Fixed Charge Coverage, Industry | ||||||
Communication Services | 5.42 | 4.32 | 6.04 | 3.78 | — |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= 12,548 ÷ 5,694 = 2.20
2 Click competitor name to see calculations.
- Earnings before fixed charges and tax
- There is a consistent positive trend in earnings before fixed charges and tax from 2019 to 2023. The value increased from $6,656 million in 2019 to $12,548 million in 2023, more than doubling over the five-year period. This indicates steady growth in the company's core earnings capacity before accounting for fixed charges and taxes.
- Fixed charges
- Fixed charges have also shown an upward trend, rising from $4,225 million in 2019 to $5,694 million in 2023. Although fixed charges are increasing, the rate of increase is less steep compared to earnings before fixed charges and tax. This suggests growing but relatively controlled fixed financial obligations.
- Fixed charge coverage ratio
- The fixed charge coverage ratio improved significantly from 1.58 in 2019 to a peak of 2.48 in 2022, indicating a strengthening ability to cover fixed charges from earnings. However, in 2023, this ratio declined to 2.2, signaling a slight reduction in coverage strength despite still being considerably higher than the 2019 level. This decrease can be attributed to either the rising fixed charges or a slowdown in growth of earnings before fixed charges and tax during the last year.
- Overall Analysis
- The overall financial condition with respect to fixed charge coverage shows improvement over the observed period, demonstrating enhanced capacity to meet fixed obligations. The company's earnings growth outpaces the growth in fixed charges for most of the period, resulting in improved financial flexibility. The slight dip in the coverage ratio in 2023 warrants attention but does not currently undermine the company's overall financial health.