Expand Energy Corp. (NASDAQ:EXE)

The financial ratios indicate notable shifts in the company's leverage and ability to cover interest expenses over the observed periods.

Debt to Equity

The ratio decreased significantly from 0.52 in March and June 2022 to a low of 0.19 by December 2023 and maintained near that level through September 2024. However, it then increased to 0.3 by March 2025. This trend suggests a substantial reduction in debt relative to equity over the first three years, followed by a moderate rebound in leverage.

Debt to Capital

This ratio followed a similar pattern, declining steadily from 0.34 in early 2022 to 0.16–0.17 during mid to late 2024, indicating less reliance on debt financing. A slight increase to 0.23 was observed in the final period analyzed, aligning with the upward movement in debt to equity.

Debt to Assets

The ratio gradually decreased from approximately 0.21–0.22 in early 2022 to a range of 0.14–0.15 through 2023 and most of 2024, reflecting reduced debt relative to total assets. This ratio then increased to 0.19 by March 2025, again consistent with the increase in leverage ratios.

Financial Leverage

Financial leverage dropped markedly from 2.47 in March 2022 to around 1.3 by late 2023 and remained stable until a notable increase to 1.62 was recorded in early 2025. The initial decline indicates a strengthening equity base or debt reduction, with some reversal later on.

Interest Coverage

Interest coverage demonstrated considerable volatility. Starting strongly negative at -1.25 in March 2022, it surged to very high positive values peaking near 39 in early 2023 and remained elevated through late 2023. Subsequently, it fell sharply, turning negative again in late 2024 and early 2025 at -5.84 and -6.32, respectively. This suggests that the company's earnings were initially insufficient to cover interest earlier on, improved substantially through 2023, but declined toward the end of the period, indicating increasing difficulty in meeting interest obligations.

In summary, the company showed a trend of deleveraging from 2022 into 2024, evidenced by declines in debt ratios and financial leverage. However, the last recorded period reveals a reversal with increasing debt levels relative to equity, capital, and assets. Concurrently, interest coverage improved markedly before deteriorating substantially toward the end, signaling potential concerns regarding profitability or interest expense coverage going forward.

Total Debt

The total debt exhibited fluctuations over the quarters, initially rising from 2,774 million to a peak of 3,093 million in December 2022. Subsequently, it declined steadily to 2,017 million by September 2024, indicating a significant deleveraging phase. However, debt surged notably in the last two reported quarters, reaching 5,680 million by December 2024 and slightly decreasing to 5,243 million by March 2025. This sharp increase suggests a substantial new borrowing or refinancing event towards the end of the period.

Stockholders’ Equity

Stockholders’ equity showed a consistent upward trend from 5,383 million in March 2022 to a peak of 10,729 million in December 2023. The equity slightly declined in subsequent quarters, reaching 10,188 million in September 2024. However, there was a marked increase afterwards, culminating in 17,565 million by December 2024 and maintaining a high level of 17,191 million by March 2025. The overall growth in equity reflects strong retained earnings, capital injections, or positive valuation changes, especially pronounced towards the end of the reporting period.

Debt to Equity Ratio

The debt to equity ratio decreased steadily from 0.52 in early 2022 to a low of approximately 0.19–0.20 range through the majority of 2023 and early 2024, signifying an improved capital structure with less reliance on debt financing relative to equity. However, this ratio reversed course in the final two quarters, increasing to 0.32 by December 2024 and slightly declining to 0.30 by March 2025. This ratio movement aligns with the spikes observed in total debt and indicates a shift towards higher leverage in the most recent periods.

Summary

The data suggests a period of deleveraging and equity growth from early 2022 through most of 2023 and early 2024, resulting in a stronger equity base and lower leverage. Toward the latter part of the timeline, both total debt and equity rose sharply, with debt increasing proportionally more, leading to a higher debt to equity ratio. This pattern may reflect strategic financial decisions such as increased borrowing for expansion, acquisitions, or other capital-intensive initiatives, impacting the company’s leverage metrics significantly by early 2025.

The financial data reveals several notable trends in the company's debt and capital structure over the observed periods. Total debt exhibited moderate fluctuations, beginning at approximately $2.77 billion and rising to a peak near $3.09 billion by the end of 2022. Subsequently, it decreased steadily throughout 2023, reaching a low around $2.02 billion by mid-2024, before experiencing a sharp spike to approximately $5.68 billion at the end of 2024. This elevated level slightly receded to about $5.24 billion by the first quarter of 2025.

Total capital generally demonstrated an overall upward trajectory. Starting from roughly $8.16 billion in early 2022, it climbed steadily to nearly $12.22 billion by the end of 2022, continued growing through 2023 with minor fluctuations, and then surged significantly to reach approximately $23.25 billion by the end of 2024. It remained at similarly high levels into the beginning of 2025, albeit with a slight decrease.

The debt-to-capital ratio declined substantially from early 2022, dropping from approximately 0.34 to a low near 0.16 during mid-2023 through mid-2024. This indicated a reduced reliance on debt relative to the overall capital base during this period. However, in the final quarters of 2024 and into early 2025, the ratio increased again to roughly 0.24, reflecting the rapid expansion in total debt outpacing the increase in total capital.

Total Debt

Displayed initial growth followed by a downward trend through most of 2023 and into mid-2024, before a significant spike occurred late in 2024.

Total Capital

Generally increased throughout the entire period, with a pronounced rise from late 2024 onward, suggesting expansion through equity or retained earnings.

Debt to Capital Ratio

Decreased markedly in 2022 and remained low through most of 2023 and mid-2024, implying improved leverage metrics, then rose again at the end of 2024, reflecting increased leverage risk.

Overall, the data indicates a period of deleveraging and capital strengthening during 2022 and 2023, followed by significant increases in both debt and capital in late 2024, which led to a moderate increase in leverage ratios. The sharp rise in total debt and capital at the end of 2024 warrants further investigation to understand the underlying causes, such as possible financing activities or major investments impacting the capital structure.

The financial data reveals multiple trends in debt management and asset growth over the reported quarters.

Total Debt

Total debt initially fluctuated between approximately 2,700 million and 3,100 million USD from early 2022 to the end of 2022. A significant reduction occurred starting in March 2023, with total debt stabilizing around 2,000 million USD through September 2024. However, a notable increase took place in the last two reported quarters, climbing sharply to about 5,680 million and 5,243 million USD respectively. This indicates a renewed borrowing or financing activity during that period.

Total Assets

Total assets showed a steady increase from around 13,300 million USD in early 2022 to nearly 15,500 million USD by the end of 2022, reflecting asset growth or acquisitions. This was followed by a gradual decline through mid-2024, dropping to approximately 13,400 million USD. In the final two quarters, asset levels surged again, nearly doubling to about 27,900 million USD, mirroring the increased debt levels and suggesting sizable investments or asset acquisitions.

Debt to Assets Ratio

The debt to assets ratio moved consistently between 0.19 and 0.22 throughout 2022, then declined significantly in 2023 and into 2024, stabilizing around 0.14 to 0.15. This demonstrates improved leverage position and possibly greater asset base relative to debt. Towards the end of the period, the ratio rose abruptly to around 0.19 – 0.20, indicating increased leverage aligned with the rise in total debt and assets.

Overall, the company exhibited a conservative leverage trend throughout most of 2023 and early 2024, reducing debt and maintaining a low debt to asset ratio. The latter part of the timeline shows a strategic shift marked by a substantial increase in both debt and assets, raising the leverage ratio back toward previous higher levels. This pattern suggests a phase of aggressive expansion or capital expenditure financed through additional debt.

The financial data demonstrates several notable trends over the observed periods. Total assets showed a general upward trend from March 2022 through December 2022, increasing from 13,293 million US dollars to 15,468 million US dollars. However, starting in the first quarter of 2023, total assets began to decline gradually, reaching 13,392 million US dollars by the third quarter of 2024. There was a significant and abrupt increase at the end of 2024, with total assets nearly doubling to approximately 27,894 million US dollars, and this level was maintained into the first quarter of 2025.

Stockholders' equity experienced consistent growth from March 2022 to December 2022, rising from 5,383 million US dollars to 9,124 million US dollars. This increase continued steadily into early 2023, peaking at 10,729 million US dollars in December 2023. Following this period, equity values decreased modestly through the first three quarters of 2024, falling to 10,188 million US dollars. Similar to total assets, equity also saw a substantial rise by December 2024, reaching 17,565 million US dollars and remaining stable into the subsequent quarter.

The financial leverage ratio showed a pronounced decline from 2.47 at the end of the first quarter of 2022 to 1.31 by September 2023. This significant decrease signals a reduction in the proportion of assets financed by debt, suggesting an improvement in the company’s financial risk profile over this period. The ratio remained relatively stable at around 1.31 through the end of the third quarter of 2024. However, a moderate increase was observed in the last quarter of 2024 and the first quarter of 2025, rising to approximately 1.59 and 1.62, respectively, indicating a slight shift towards higher leverage.

Overall, the data illustrates an initial phase of asset and equity growth accompanied by a strong deleveraging trend. This period was followed by some decline in total assets and equity with stable financial leverage. The end of 2024 marks a substantial expansion in both total assets and stockholders’ equity, alongside a modest increase in financial leverage, pointing to a major capital restructuring or acquisition event affecting the balance sheet composition.

Earnings before interest and tax (EBIT)

The EBIT exhibits considerable volatility over the observed periods. Starting with a negative figure of -778 million US dollars in March 2022, it sharply improved to positive territory in the subsequent quarters, peaking at 2,230 million US dollars in December 2022. Following this peak, a decline is observed with fluctuations at mid-range positive values through 2023. From March 2024 onwards, EBIT turns negative again and remains so through March 2025, indicating a deteriorating operating performance towards the end of the timeframe.

Interest Expense

Interest expense values have generally remained stable with minor fluctuations throughout the periods. After a low of 32 million US dollars at the start, the expense oscillates between the high teens and mid-60s million, with a notable increase observed in the last few quarters, reaching 64 million US dollars in December 2024, followed by 59 million in March 2025. This suggests a gradual increase in financing costs or debt level in the later periods.

Interest Coverage Ratio

The interest coverage ratio, which measures the ability to meet interest obligations from operating earnings, initially shows a negative value confirming the initial EBIT loss. It rapidly improves, reaching high levels above 30 in late 2022 and mid-2023, indicating strong operating income relative to interest expense during that time. A downward trend begins in early 2024, with the ratio falling below 1 and becoming negative by December 2024 and March 2025. This decline signals increased difficulty in covering interest expenses, reflecting weakened earnings and potential financial stress.