Analysis of Solvency Ratios
Quarterly Data
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
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Solvency Ratios (Summary)
Becton, Dickinson & Co., solvency ratios (quarterly data)
Based on: 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
The analysis of the financial leverage and debt-related ratios over the reported periods indicates a general trend towards deleveraging and improved debt management.
- Debt to Equity Ratio
- This ratio decreased notably from 1.45 at the end of 2016 to lower levels around 0.72 to 0.76 in early 2022. The decline was relatively steady, with some fluctuations around 2020, suggesting a gradual reduction in leverage relative to shareholders' equity, improving the company's financial stability.
- Debt to Capital Ratio
- Similarly, the debt to capital ratio showed a downward trend from 0.59 at the end of 2016 to approximately 0.42-0.43 by early 2022. This reduction reflects a decreased reliance on debt in the overall capital structure, consistent with the declining debt to equity pattern.
- Debt to Assets Ratio
- This ratio declined from 0.45 to about 0.33-0.34 during the same period. The decrease suggests an increase in asset base relative to liabilities, or a proportionately greater decrease in debt levels, signifying enhanced asset coverage and potentially lower financial risk.
- Financial Leverage
- The financial leverage ratio decreased from 3.21 to around 2.21-2.23. Although the reduction is less steep than in other debt ratios, it indicates a modest decline in the extent to which the company uses fixed financial costs to magnify returns, contributing to a more conservative capital structure.
- Interest Coverage Ratio
- The interest coverage ratio was volatile but displayed an overall improvement. Starting at 4.89, it dipped sharply in 2017 and early 2018 reaching lows around 1.05, before recovering steadily to values above 5.0 by 2021 and early 2022. This improvement highlights enhanced ability to meet interest obligations from operating earnings, reflecting strengthened operational performance or reduced interest expenses.
In summary, the company has gradually reduced its financial leverage and debt dependency over the examined period while improving its capacity to cover interest expenses. These changes point towards a more prudent financial policy and potentially lower financial risk exposure.
Debt Ratios
Coverage Ratios
Debt to Equity
Becton, Dickinson & Co., debt to equity calculation (quarterly data)
| Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Current debt obligations | |||||||||||||||||||||||||||||
| Long-term debt, excluding current portion | |||||||||||||||||||||||||||||
| Total debt | |||||||||||||||||||||||||||||
| Shareholders’ equity | |||||||||||||||||||||||||||||
| Solvency Ratio | |||||||||||||||||||||||||||||
| Debt to equity1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Debt to Equity, Competitors2 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
1 Q2 2022 Calculation
Debt to equity = Total debt ÷ Shareholders’ equity
= ÷ =
2 Click competitor name to see calculations.
- Total Debt
- The total debt demonstrates significant variability across the observed periods. Initially, there was a moderate decline from approximately 11 billion to just over 10 billion in early 2017, followed by a sharp increase peaking near 23 billion by the end of 2017. Subsequently, total debt generally trended downward with minor fluctuations, decreasing steadily from early 2018 through the end of 2021, reaching a low near 17.4 billion. However, there is a modest uptick in the most recent period to around 18.6 billion. This overall pattern indicates periodic leveraging followed by debt reduction efforts, with an increase occurring again towards the final period.
- Shareholders’ Equity
- Shareholders’ equity exhibited notable growth, particularly during the early part of the timeline. Between late 2016 and the end of 2017, equity increased markedly from approximately 7.6 billion to over 21 billion. After this rapid increase, equity remained relatively stable with minor fluctuations ranging around 20-21 billion for several quarters. From early 2020 onward, there is a renewed upward trend with equity rising steadily and surpassing 24 billion by the first quarter of 2022. The equity expansion over the entire period suggests a strengthening capital base.
- Debt to Equity Ratio
- The debt to equity ratio reflects the interplay between debt and equity movements. Starting at a relatively high level of around 1.45 in late 2016, the ratio declined sharply through 2017, reaching close to 1.0 by the end of that year. From 2018 through early 2020, the ratio stayed below 1.0, consistently trending lower and reaching a low near 0.71 in late 2021. In the last reported period, the ratio increased slightly to approximately 0.76. This overall downward trend indicates improved balance sheet leverage and greater reliance on shareholder equity compared to debt, reflecting a stronger financial position through the periods observed.
- Summary Insight
- The data reveals a cycle of increased borrowing around 2017 followed by active deleveraging and equity growth over the subsequent years. The firm's financial structure appears to have improved, with equity outpacing debt growth, leading to a declining debt to equity ratio. Recent periods show signs of stabilizing debt after a sustained reduction, while equity continues to advance, indicating a robust capital structure. These trends suggest prudent financial management aimed at reducing leverage risk and enhancing shareholder value over time.
Debt to Capital
Becton, Dickinson & Co., debt to capital calculation (quarterly data)
| Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Current debt obligations | |||||||||||||||||||||||||||||
| Long-term debt, excluding current portion | |||||||||||||||||||||||||||||
| Total debt | |||||||||||||||||||||||||||||
| Shareholders’ equity | |||||||||||||||||||||||||||||
| Total capital | |||||||||||||||||||||||||||||
| Solvency Ratio | |||||||||||||||||||||||||||||
| Debt to capital1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Debt to Capital, Competitors2 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
1 Q2 2022 Calculation
Debt to capital = Total debt ÷ Total capital
= ÷ =
2 Click competitor name to see calculations.
- Total Debt
- The total debt exhibited notable volatility initially, with an increase from approximately 11.0 billion to 22.8 billion US dollars over the span from the end of 2016 to the end of 2017. Subsequently, total debt followed a generally declining trend, reducing gradually from 21.1 billion in December 2018 to around 17.4 billion by December 2021. A slight uptick was observed in March 2022, with debt rising to 18.6 billion. This pattern suggests an initial period of significant debt accumulation followed by a consistent deleveraging strategy, although the recent increase may indicate renewed borrowing or financing activity.
- Total Capital
- Total capital increased sharply in the early periods, rising from 18.6 billion USD at the end of 2016 to a peak of approximately 44.0 billion by the end of 2017. After this peak, total capital demonstrated a general downward trend through late 2019, declining to around 40.6 billion. During 2020 and early 2021, capital levels showed modest fluctuations but mostly stabilized near the 41.0 to 42.5 billion range. By March 2022, total capital rebounded to a higher level of roughly 43.2 billion USD. These movements suggest substantial capital expansion followed by a phase of consolidation and modest recovery.
- Debt to Capital Ratio
- The debt to capital ratio began at 0.59 at the end of 2016, fluctuated slightly upward mid-2017, and then declined steadily over subsequent periods. From a high near 0.60 in mid-2017, the ratio progressively decreased to approximately 0.48 by the end of 2019. Notably, the ratio dropped sharply in 2020 to a low near 0.42 and remained relatively stable around this level through early 2022, with minor increases to approximately 0.43. This trend indicates a gradual reduction in leverage relative to capital, reflecting improved financial structure and potentially reduced risk associated with debt load.
- Overall Trends and Insights
- The data reflects a period of initial capital expansion and debt accumulation, followed by a concerted effort to reduce debt and stabilize capital levels. The decline in the debt to capital ratio indicates a strengthening of the company’s balance sheet with a proportional decrease in reliance on debt financing. Despite some fluctuations, the later periods demonstrate improvement in leverage metrics, which could suggest strategic financial management aimed at enhancing sustainability and creditworthiness. The slight increase in debt observed in early 2022 may merit monitoring to assess its impact on future leverage and capital dynamics.
Debt to Assets
Becton, Dickinson & Co., debt to assets calculation (quarterly data)
| Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Current debt obligations | |||||||||||||||||||||||||||||
| Long-term debt, excluding current portion | |||||||||||||||||||||||||||||
| Total debt | |||||||||||||||||||||||||||||
| Total assets | |||||||||||||||||||||||||||||
| Solvency Ratio | |||||||||||||||||||||||||||||
| Debt to assets1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Debt to Assets, Competitors2 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
1 Q2 2022 Calculation
Debt to assets = Total debt ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
- Total Debt
- The total debt exhibited notable volatility over the observed periods. Initially, debt decreased from approximately $11.0 billion to $10.3 billion, followed by a sharp increase peaking around $22.8 billion at the end of 2017. After this peak, total debt trended downward with fluctuations, reaching a low point near $17.4 billion by the end of 2021. However, the first quarter of 2022 saw an uptick, bringing the debt level back up to $18.6 billion. Overall, the trend reflects significant debt structuring activity and repayments over time, with a general reduction in debt after the 2017 peak.
- Total Assets
- Total assets showed an increasing trend with some fluctuations throughout the period. Starting from approximately $24.3 billion, the asset base surged significantly by mid-2017, reaching over $55.3 billion by the end of 2017. Following this peak, assets remained relatively stable in the range of $52.9 billion to $54.9 billion with minor variations. Towards the end of the period, assets slightly declined but then increased again by early 2022, ending near $54.8 billion. This pattern indicates asset growth primarily during 2017, followed by stabilization with moderate fluctuations.
- Debt to Assets Ratio
- The debt to assets ratio decreased overall from 0.45 at the end of 2016 to approximately 0.34 by the first quarter of 2022. Initially, the ratio increased briefly to 0.51 in mid-2017, coinciding with the spike in total debt and assets. Subsequently, the ratio consistently declined, reflecting either effective debt reduction, asset growth, or a combination thereof. By the end of the sample period, the ratio stabilized around 0.33 to 0.34, indicating a more conservative leverage position compared to earlier periods.
- Summary Insights
- In summary, the data reveals a period of aggressive growth in both debt and assets around 2017, followed by a phase of asset stabilization and gradual debt reduction. Despite fluctuations in total debt, the leverage ratio has decreased, signaling improved balance sheet strength. The consistent asset base post-2017 supports this reduced reliance on debt. The recent slight increase in debt in early 2022 warrants monitoring but does not yet indicate a reversal of the overall deleveraging trend.
Financial Leverage
Becton, Dickinson & Co., financial leverage calculation (quarterly data)
| Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Total assets | |||||||||||||||||||||||||||||
| Shareholders’ equity | |||||||||||||||||||||||||||||
| Solvency Ratio | |||||||||||||||||||||||||||||
| Financial leverage1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Financial Leverage, Competitors2 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
1 Q2 2022 Calculation
Financial leverage = Total assets ÷ Shareholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data indicates several notable trends in the company's asset base, equity position, and financial leverage over the period from late 2016 to early 2022.
- Total Assets
- The total assets demonstrate a marked increase between December 2016 and December 2017, rising from approximately $24.3 billion to $55.4 billion. After this significant growth, asset values stabilize somewhat, fluctuating mildly but generally maintaining a level slightly above $53 billion through March 2022. This pattern suggests a substantial asset acquisition or revaluation during 2017, followed by a period of relative stability.
- Shareholders’ Equity
- Shareholders’ equity mirrors the asset trend, with a pronounced rise from roughly $7.6 billion at the end of 2016 to about $21.2 billion in December 2017. Post-2017, equity levels show moderate variability but remain within a relatively narrow range between $20.9 billion and $24.7 billion through early 2022. Notably, there is an upward adjustment around mid-2020, peaking near $24.7 billion in late 2020 and again showing some improvement in early 2022, reflecting stable or slightly improved equity capitalization.
- Financial Leverage
- The financial leverage ratio declines steadily from a high of approximately 3.21 at the end of 2016 to a low near 2.21 in late 2021 and early 2022. This downward trend in leverage suggests a deliberate reduction in the relative level of debt compared to equity, indicating a strengthening balance sheet and potentially a more conservative financial structure post-2017. A slight increase in leverage is observed around the first quarter of 2020, possibly linked to market uncertainties during that period, but the ratio quickly returns to a downward trajectory.
In summary, the financial data points to a significant expansion in both assets and equity up to the end of 2017, followed by a plateau with minor fluctuations. Concurrently, there is a consistent reduction in financial leverage over the duration analyzed, signaling an improved solvency profile and potential risk mitigation efforts. These trends collectively portray a period of rapid growth succeeded by consolidation and a move towards enhanced financial stability.
Interest Coverage
Becton, Dickinson & Co., interest coverage calculation (quarterly data)
| Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Net income (loss) | |||||||||||||||||||||||||||||
| Add: Income tax expense | |||||||||||||||||||||||||||||
| Add: Interest expense | |||||||||||||||||||||||||||||
| Earnings before interest and tax (EBIT) | |||||||||||||||||||||||||||||
| Solvency Ratio | |||||||||||||||||||||||||||||
| Interest coverage1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Interest Coverage, Competitors2 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
1 Q2 2022 Calculation
Interest coverage
= (EBITQ2 2022
+ EBITQ1 2022
+ EBITQ4 2021
+ EBITQ3 2021)
÷ (Interest expenseQ2 2022
+ Interest expenseQ1 2022
+ Interest expenseQ4 2021
+ Interest expenseQ3 2021)
= ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals notable fluctuations and trends in the key financial metrics—Earnings Before Interest and Tax (EBIT), interest expense, and interest coverage ratio—across the observed periods.
- Earnings Before Interest and Tax (EBIT)
- The EBIT figures demonstrate significant volatility over the quarters. There are instances of negative EBIT values, such as in June 2017 (-220 million USD), indicating periods of operational losses. However, an upward trend is observable from late 2019 onwards, with EBIT values generally increasing, culminating in a peak of 1,275 million USD in December 2020. This suggests improved operational performance in the more recent quarters, despite earlier inconsistencies.
- Interest Expense
- The interest expense remains relatively stable throughout the period, with values ranging from about 95 million USD at the start to around 98-101 million USD towards the end. Although minor fluctuations exist—such as a peak of 185 million USD in March 2018—the overall trend suggests controlled interest costs of debt or financing, with no significant upward or downward shift over time.
- Interest Coverage Ratio
- The interest coverage ratio, which measures the ability to meet interest payments from EBIT, exhibits considerable variability aligned with fluctuations in EBIT. Initially, the ratio shows moderate values around 4.89 to 4.98 but declines to lows near or below 1.0 in early 2018, indicating tight coverage and potential financial strain. Following this, from late 2019 onwards, the ratio steadily improves, surpassing 5.0 multiple times and reaching a high of 5.78 in September 2021. This improvement reflects stronger earnings relative to interest obligations, correlating with the rise in EBIT during this timeframe.
In summary, the company experienced operational challenges leading to volatile EBIT and low-interest coverage in some quarters, particularly around 2017 and early 2018. The interest expense remained generally consistent, not exacerbating financial pressures. The more recent periods show improved operational profitability and enhanced capacity to cover interest expenses, highlighting a positive shift in financial health and resilience.