Analysis of Solvency Ratios
Quarterly Data
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
Carrier Global Corp., solvency ratios (quarterly data)
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
The analysis of the financial leverage and debt-related ratios over the specified periods indicates a general trend toward improved capital structure and reduced financial risk.
- Debt to Equity Ratio
- The debt to equity ratio experienced a gradual decline from 1.5 at the start of the period to 1.09 by the end. This suggests a steady reduction in reliance on debt financing relative to shareholders' equity. The ratio including operating lease liabilities follows a similar pattern, decreasing from 1.6 to 1.15, further confirming the downward trend in overall leverage when accounting for lease obligations.
- Debt to Capital Ratio
- Similarly, the debt to capital ratio decreased over the periods, moving from 0.6 down to 0.52. The adjusted measure including operating lease liabilities also showed a decline from 0.61 to 0.53. These trends reflect an incremental improvement in the company's capital structure, with less debt financing relative to total capital invested.
- Debt to Assets Ratio
- The debt to assets ratio demonstrated a modest downward movement from 0.39 to 0.34 during the analyzed quarters. Including operating lease liabilities, the ratio decreased from 0.42 to 0.35. This indicates a reduction in leverage concerning total asset base, signifying enhanced asset coverage and potential risk mitigation.
- Financial Leverage
- The financial leverage ratio, representing the degree of total assets financed by shareholders’ equity, fell from 3.83 to 3.25. This decrease aligns with the patterns seen in the debt to equity and debt to capital ratios, suggesting that the company has been consistently working towards lowering its overall leverage position and possibly strengthening its equity base.
Overall, the financial data exhibits a clear and consistent reduction in leverage across multiple measures. This trend may reflect a strategic focus on improving financial stability and reducing risk exposure through lower debt reliance and enhanced equity financing. The inclusion of operating lease liabilities in the ratios also indicates that the company is managing these commitments effectively, maintaining favorable leverage levels even when these liabilities are considered.
Debt Ratios
Debt to Equity
Carrier Global Corp., debt to equity calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||
| Current portion of long-term debt | 142) | 140) | 219) | 269) | 256) | 183) | 130) | 125) | 153) | ||||
| Long-term debt, net of current portion | 8,708) | 8,702) | 8,670) | 8,298) | 8,305) | 9,513) | 9,558) | 9,600) | 9,577) | ||||
| Total debt | 8,850) | 8,842) | 8,889) | 8,567) | 8,561) | 9,696) | 9,688) | 9,725) | 9,730) | ||||
| Equity attributable to common shareowners | 8,134) | 7,758) | 7,152) | 6,696) | 7,101) | 6,767) | 6,900) | 6,756) | 6,489) | ||||
| Solvency Ratio | |||||||||||||
| Debt to equity1 | 1.09 | 1.14 | 1.24 | 1.28 | 1.21 | 1.43 | 1.40 | 1.44 | 1.50 | ||||
| Benchmarks | |||||||||||||
| Debt to Equity, Competitors2 | |||||||||||||
| Boeing Co. | — | — | — | — | — | — | — | — | — | ||||
| Caterpillar Inc. | 2.04 | 2.33 | 2.34 | 2.35 | 2.20 | 2.29 | 2.21 | 2.23 | 2.30 | ||||
| Eaton Corp. plc | 0.50 | 0.51 | 0.56 | 0.59 | 0.58 | 0.52 | 0.57 | 0.79 | 0.68 | ||||
| GE Aerospace | 0.71 | 0.89 | 0.97 | 0.94 | 0.86 | 0.87 | 1.68 | 1.90 | 2.12 | ||||
| Honeywell International Inc. | 1.13 | 1.17 | 0.96 | 1.09 | 1.05 | 1.06 | 1.19 | 1.19 | 1.19 | ||||
| Lockheed Martin Corp. | 1.62 | 1.68 | 0.96 | 1.02 | 1.16 | 1.07 | 1.21 | 1.87 | 1.93 | ||||
| RTX Corp. | 0.47 | 0.44 | 0.48 | 0.45 | 0.43 | 0.43 | 0.44 | 0.44 | 0.44 | ||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q1 2023 Calculation
Debt to equity = Total debt ÷ Equity attributable to common shareowners
= 8,850 ÷ 8,134 = 1.09
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several noteworthy trends regarding the company's capital structure and leverage over the observed periods.
- Total Debt
- The total debt level remained relatively stable throughout 2021, fluctuating slightly around the 9,700 million US dollar mark. However, entering 2022, there was a notable decrease in debt to approximately 8,560 million US dollars by the first half of the year. This reduction was followed by a modest increase towards the end of 2022, raising debt levels near 8,850 million US dollars at the first quarter of 2023. Overall, total debt showed a downward adjustment compared to 2021 but maintained a relatively consistent level within 2022 and early 2023.
- Equity Attributable to Common Shareowners
- Equity demonstrated a general upward trajectory throughout the observed periods. Starting at approximately 6,490 million US dollars at the first quarter of 2021, equity increased steadily, reaching over 8,100 million US dollars by the first quarter of 2023. Despite a slight dip in mid-2022, the overall trend illustrates strengthening equity, indicating an improvement in the company’s net asset position over time.
- Debt to Equity Ratio
- The debt to equity ratio displayed a declining trend, moving from 1.5 at the beginning of 2021 down to 1.09 in the first quarter of 2023. The ratio showed consistent improvement throughout the periods, with a significant reduction during 2022, reflecting a decrease in leverage relative to equity. This indicates a gradual shift towards a stronger equity base compared to debt, implying improved financial stability and potentially reduced financial risk.
In summary, the data reflects a company that has slightly reduced its total debt while consistently increasing equity levels, leading to a substantial improvement in the debt to equity ratio. This suggests an overall positive trend in capital structure management, highlighting enhanced financial resilience and reduced reliance on debt financing over the recent quarters.
Debt to Equity (including Operating Lease Liability)
Carrier Global Corp., debt to equity (including operating lease liability) calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||
| Current portion of long-term debt | 142) | 140) | 219) | 269) | 256) | 183) | 130) | 125) | 153) | ||||
| Long-term debt, net of current portion | 8,708) | 8,702) | 8,670) | 8,298) | 8,305) | 9,513) | 9,558) | 9,600) | 9,577) | ||||
| Total debt | 8,850) | 8,842) | 8,889) | 8,567) | 8,561) | 9,696) | 9,688) | 9,725) | 9,730) | ||||
| Long-term operating lease liabilities | 506) | 529) | 514) | 490) | 491) | 527) | 515) | 635) | 621) | ||||
| Total debt (including operating lease liability) | 9,356) | 9,371) | 9,403) | 9,057) | 9,052) | 10,223) | 10,203) | 10,360) | 10,351) | ||||
| Equity attributable to common shareowners | 8,134) | 7,758) | 7,152) | 6,696) | 7,101) | 6,767) | 6,900) | 6,756) | 6,489) | ||||
| Solvency Ratio | |||||||||||||
| Debt to equity (including operating lease liability)1 | 1.15 | 1.21 | 1.31 | 1.35 | 1.27 | 1.51 | 1.48 | 1.53 | 1.60 | ||||
| Benchmarks | |||||||||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | |||||||||||||
| Eaton Corp. plc | 0.53 | 0.53 | 0.59 | 0.62 | 0.60 | 0.54 | 0.59 | 0.81 | 0.70 | ||||
| RTX Corp. | 0.50 | 0.46 | 0.50 | 0.47 | 0.46 | 0.45 | 0.46 | 0.46 | 0.46 | ||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q1 2023 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Equity attributable to common shareowners
= 9,356 ÷ 8,134 = 1.15
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several noteworthy trends concerning the company’s debt levels, equity base, and leverage ratios over the reported periods.
- Total Debt (Including Operating Lease Liability)
- The total debt remained relatively stable throughout 2021, fluctuating slightly around the range of approximately $10,200 million to $10,360 million. However, starting from the first quarter of 2022, there was a marked reduction in total debt, dropping to around $9,052 million by March 31, 2022. This lower debt level was generally maintained through to March 31, 2023, with only minor increases and decreases observed, ending at $9,356 million.
- Equity Attributable to Common Shareowners
- Equity showed an upward trend overall, beginning at $6,489 million in March 31, 2021, and rising to $8,134 million by March 31, 2023. There was a slight dip in the middle of 2022, but subsequently, equity exhibited steady growth, indicating an improving capital base and increased shareholder value over the period.
- Debt to Equity Ratio (Including Operating Lease Liability)
- The debt to equity ratio progressively decreased over the examined quarters. Initially, it stood at 1.6 in March 31, 2021, before trending downward to 1.15 by March 31, 2023. This decline reflects an improvement in the company’s financial leverage position, characterized by either a reduction in debt, an increase in equity, or both. The ratio's decrease suggests enhanced financial stability and a potentially lower risk profile facing creditors and investors over the period.
Overall, the company’s financial stance appears to have strengthened through the reduction of total debt alongside growth in equity. The resulting decrease in the debt to equity ratio implies a more conservative capital structure and potentially a more favorable credit standing as of the latest reported quarter.
Debt to Capital
Carrier Global Corp., debt to capital calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||
| Current portion of long-term debt | 142) | 140) | 219) | 269) | 256) | 183) | 130) | 125) | 153) | ||||
| Long-term debt, net of current portion | 8,708) | 8,702) | 8,670) | 8,298) | 8,305) | 9,513) | 9,558) | 9,600) | 9,577) | ||||
| Total debt | 8,850) | 8,842) | 8,889) | 8,567) | 8,561) | 9,696) | 9,688) | 9,725) | 9,730) | ||||
| Equity attributable to common shareowners | 8,134) | 7,758) | 7,152) | 6,696) | 7,101) | 6,767) | 6,900) | 6,756) | 6,489) | ||||
| Total capital | 16,984) | 16,600) | 16,041) | 15,263) | 15,662) | 16,463) | 16,588) | 16,481) | 16,219) | ||||
| Solvency Ratio | |||||||||||||
| Debt to capital1 | 0.52 | 0.53 | 0.55 | 0.56 | 0.55 | 0.59 | 0.58 | 0.59 | 0.60 | ||||
| Benchmarks | |||||||||||||
| Debt to Capital, Competitors2 | |||||||||||||
| Boeing Co. | 1.39 | 1.39 | 1.45 | 1.35 | 1.36 | 1.35 | 1.30 | 1.36 | 1.40 | ||||
| Caterpillar Inc. | 0.67 | 0.70 | 0.70 | 0.70 | 0.69 | 0.70 | 0.69 | 0.69 | 0.70 | ||||
| Eaton Corp. plc | 0.34 | 0.34 | 0.36 | 0.37 | 0.37 | 0.34 | 0.36 | 0.44 | 0.40 | ||||
| GE Aerospace | 0.41 | 0.47 | 0.49 | 0.48 | 0.46 | 0.47 | 0.63 | 0.65 | 0.68 | ||||
| Honeywell International Inc. | 0.53 | 0.54 | 0.49 | 0.52 | 0.51 | 0.51 | 0.54 | 0.54 | 0.54 | ||||
| Lockheed Martin Corp. | 0.62 | 0.63 | 0.49 | 0.50 | 0.54 | 0.52 | 0.55 | 0.65 | 0.66 | ||||
| RTX Corp. | 0.32 | 0.31 | 0.32 | 0.31 | 0.30 | 0.30 | 0.30 | 0.31 | 0.31 | ||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q1 2023 Calculation
Debt to capital = Total debt ÷ Total capital
= 8,850 ÷ 16,984 = 0.52
2 Click competitor name to see calculations.
- Total Debt
- The total debt remained relatively stable throughout 2021, fluctuating slightly around the $9,700 million mark. Beginning in 2022, a noticeable decrease occurred, with debt levels dropping to approximately $8,560 million by mid-year. Following this decline, total debt gradually increased in the latter half of 2022 and early 2023, stabilizing near $8,850 million by the first quarter of 2023. Overall, there was a downward trend in total debt from early 2021 to early 2023.
- Total Capital
- Total capital showed a moderate decline in the first half of 2022, decreasing from around $16,400 million at the end of 2021 to about $15,260 million by mid-2022. However, from mid-2022 onwards, total capital recovered steadily, reaching approximately $16,984 million by March 2023. This suggests an overall strengthening of the capital base after a temporary contraction during early 2022.
- Debt to Capital Ratio
- The debt to capital ratio decreased consistently over the analyzed periods. Initially near 0.60 in early 2021, it gradually shifted downward to approximately 0.52 by the first quarter of 2023. This reduction indicates an improving leverage position, reflecting either a decrease in debt, an increase in capital, or both. The trend demonstrates enhanced financial stability and a lower proportion of debt within the company's capital structure over time.
Debt to Capital (including Operating Lease Liability)
Carrier Global Corp., debt to capital (including operating lease liability) calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||
| Current portion of long-term debt | 142) | 140) | 219) | 269) | 256) | 183) | 130) | 125) | 153) | ||||
| Long-term debt, net of current portion | 8,708) | 8,702) | 8,670) | 8,298) | 8,305) | 9,513) | 9,558) | 9,600) | 9,577) | ||||
| Total debt | 8,850) | 8,842) | 8,889) | 8,567) | 8,561) | 9,696) | 9,688) | 9,725) | 9,730) | ||||
| Long-term operating lease liabilities | 506) | 529) | 514) | 490) | 491) | 527) | 515) | 635) | 621) | ||||
| Total debt (including operating lease liability) | 9,356) | 9,371) | 9,403) | 9,057) | 9,052) | 10,223) | 10,203) | 10,360) | 10,351) | ||||
| Equity attributable to common shareowners | 8,134) | 7,758) | 7,152) | 6,696) | 7,101) | 6,767) | 6,900) | 6,756) | 6,489) | ||||
| Total capital (including operating lease liability) | 17,490) | 17,129) | 16,555) | 15,753) | 16,153) | 16,990) | 17,103) | 17,116) | 16,840) | ||||
| Solvency Ratio | |||||||||||||
| Debt to capital (including operating lease liability)1 | 0.53 | 0.55 | 0.57 | 0.57 | 0.56 | 0.60 | 0.60 | 0.61 | 0.61 | ||||
| Benchmarks | |||||||||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | |||||||||||||
| Eaton Corp. plc | 0.35 | 0.35 | 0.37 | 0.38 | 0.37 | 0.35 | 0.37 | 0.45 | 0.41 | ||||
| RTX Corp. | 0.33 | 0.32 | 0.33 | 0.32 | 0.31 | 0.31 | 0.31 | 0.32 | 0.32 | ||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q1 2023 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 9,356 ÷ 17,490 = 0.53
2 Click competitor name to see calculations.
The financial data reveals several key trends in the company's capital structure over the examined quarters. There is a noticeable downward trend in total debt from March 31, 2021, through March 31, 2023. Specifically, total debt decreased from $10,351 million to $9,356 million, reflecting a reduction in the company's leverage obligations over the period.
Total capital exhibits some fluctuations during the timeline but shows an overall increase when comparing the start and the end of the period. The total capital decreased somewhat between early 2021 and mid-2022, reaching its lowest point of $15,753 million in June 2022, before increasing consistently to $17,490 million by March 31, 2023. This indicates some instability or adjustments in capital funding sources but with an ultimate growth in capital base by the end of the period.
The debt to capital ratio consistently declined across the quarters, dropping from 0.61 in early 2021 to 0.53 by March 31, 2023. This trend points to a gradual reduction in the proportion of debt relative to total capital, suggesting a strengthening in the company’s financial leverage position and improved balance sheet stability.
- Total Debt
- Decreased overall by approximately 995 million over two years, indicating a reduction in liabilities.
- Total Capital
- Showed variability with a dip in mid-2022 but ultimately increased by around 650 million, signaling growth in the company’s capital base.
- Debt to Capital Ratio
- Consistently declined from 0.61 to 0.53, signifying reduced leverage and enhanced financial flexibility.
Debt to Assets
Carrier Global Corp., debt to assets calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||
| Current portion of long-term debt | 142) | 140) | 219) | 269) | 256) | 183) | 130) | 125) | 153) | ||||
| Long-term debt, net of current portion | 8,708) | 8,702) | 8,670) | 8,298) | 8,305) | 9,513) | 9,558) | 9,600) | 9,577) | ||||
| Total debt | 8,850) | 8,842) | 8,889) | 8,567) | 8,561) | 9,696) | 9,688) | 9,725) | 9,730) | ||||
| Total assets | 26,411) | 26,086) | 25,350) | 23,662) | 24,193) | 26,172) | 25,788) | 25,738) | 24,868) | ||||
| Solvency Ratio | |||||||||||||
| Debt to assets1 | 0.34 | 0.34 | 0.35 | 0.36 | 0.35 | 0.37 | 0.38 | 0.38 | 0.39 | ||||
| Benchmarks | |||||||||||||
| Debt to Assets, Competitors2 | |||||||||||||
| Boeing Co. | 0.41 | 0.42 | 0.42 | 0.42 | 0.43 | 0.42 | 0.43 | 0.43 | 0.42 | ||||
| Caterpillar Inc. | 0.44 | 0.45 | 0.45 | 0.46 | 0.46 | 0.46 | 0.46 | 0.46 | 0.47 | ||||
| Eaton Corp. plc | 0.25 | 0.25 | 0.26 | 0.28 | 0.27 | 0.25 | 0.27 | 0.33 | 0.30 | ||||
| GE Aerospace | 0.14 | 0.17 | 0.17 | 0.18 | 0.18 | 0.18 | 0.27 | 0.27 | 0.29 | ||||
| Honeywell International Inc. | 0.32 | 0.31 | 0.28 | 0.31 | 0.31 | 0.30 | 0.33 | 0.33 | 0.34 | ||||
| Lockheed Martin Corp. | 0.29 | 0.29 | 0.22 | 0.22 | 0.23 | 0.23 | 0.23 | 0.23 | 0.24 | ||||
| RTX Corp. | 0.21 | 0.20 | 0.21 | 0.20 | 0.20 | 0.20 | 0.20 | 0.20 | 0.20 | ||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q1 2023 Calculation
Debt to assets = Total debt ÷ Total assets
= 8,850 ÷ 26,411 = 0.34
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends in key financial metrics over the observed periods. The total debt remained relatively stable during the first year, hovering close to 9,700 million US dollars, before experiencing a marked decrease starting in the first quarter of 2022. From approximately 9,700 million US dollars, total debt dropped sharply to around 8,560 million US dollars in early 2022 and subsequently fluctuated modestly near that lower level until the first quarter of 2023, where it stabilized around 8,850 million US dollars.
Total assets demonstrate a more variable pattern with an initial increasing trend throughout 2021, rising from nearly 24,900 million to approximately 26,200 million US dollars by the end of that year. However, in early 2022, assets experienced a decline, reaching a low close to 23,700 million US dollars in the middle of 2022. Following this dip, assets recovered and increased steadily through the remainder of 2022 and into early 2023, culminating in a peak of approximately 26,400 million US dollars.
As a result of the contrasting movements in debt and assets, the debt to assets ratio displays a consistent downward trend across the entire period. Initially, the ratio decreased gradually from 0.39 at the beginning of 2021 to 0.37 by the end of 2021. This decline continued more noticeably into 2022, reaching a ratio near 0.34 by the end of the year. The first quarter of 2023 maintained this lower leverage level, with a ratio still at 0.34, suggesting a strategic reduction in financial risk relative to asset base over time.
- Total Debt
- Relatively stable around 9,700 million US dollars during 2021, followed by a sharp decrease in early 2022 to about 8,560 million US dollars, and modest fluctuations around this level into early 2023.
- Total Assets
- Increasing trend throughout 2021, peaking around 26,200 million US dollars at year-end, then a decline in early 2022 to near 23,700 million US dollars, followed by recovery and steady growth into early 2023.
- Debt to Assets Ratio
- Steady decline from 0.39 in early 2021 to 0.34 by the end of 2022 and remains stable in early 2023, indicating reduced leverage relative to asset value.
Overall, the company's financial position shows a deliberate reduction in leverage risk over the analyzed timeframe, accompanied by asset fluctuations that reflect possible strategic adjustments or external influences on asset management. The decreasing debt to assets ratio is indicative of improved balance sheet strength and potentially enhanced financial stability.
Debt to Assets (including Operating Lease Liability)
Carrier Global Corp., debt to assets (including operating lease liability) calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||
| Current portion of long-term debt | 142) | 140) | 219) | 269) | 256) | 183) | 130) | 125) | 153) | ||||
| Long-term debt, net of current portion | 8,708) | 8,702) | 8,670) | 8,298) | 8,305) | 9,513) | 9,558) | 9,600) | 9,577) | ||||
| Total debt | 8,850) | 8,842) | 8,889) | 8,567) | 8,561) | 9,696) | 9,688) | 9,725) | 9,730) | ||||
| Long-term operating lease liabilities | 506) | 529) | 514) | 490) | 491) | 527) | 515) | 635) | 621) | ||||
| Total debt (including operating lease liability) | 9,356) | 9,371) | 9,403) | 9,057) | 9,052) | 10,223) | 10,203) | 10,360) | 10,351) | ||||
| Total assets | 26,411) | 26,086) | 25,350) | 23,662) | 24,193) | 26,172) | 25,788) | 25,738) | 24,868) | ||||
| Solvency Ratio | |||||||||||||
| Debt to assets (including operating lease liability)1 | 0.35 | 0.36 | 0.37 | 0.38 | 0.37 | 0.39 | 0.40 | 0.40 | 0.42 | ||||
| Benchmarks | |||||||||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | |||||||||||||
| Eaton Corp. plc | 0.26 | 0.26 | 0.28 | 0.29 | 0.28 | 0.26 | 0.28 | 0.34 | 0.31 | ||||
| RTX Corp. | 0.22 | 0.21 | 0.22 | 0.21 | 0.21 | 0.21 | 0.21 | 0.21 | 0.21 | ||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q1 2023 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 9,356 ÷ 26,411 = 0.35
2 Click competitor name to see calculations.
The financial data reveals notable trends in the company’s debt levels, asset base, and leverage ratios over the observed periods.
- Total Debt (including operating lease liability)
-
Total debt remained relatively stable during 2021, fluctuating slightly around the 10,200 to 10,360 million US$ range. Starting in the first quarter of 2022, there was a significant reduction in total debt to approximately 9,052 million US$, maintaining levels near 9,300 million US$ through the subsequent quarters up to March 31, 2023. This suggests active debt management or repayment measures implemented in early 2022 that have effectively reduced overall indebtedness.
- Total Assets
-
Total assets exhibited a steady increase throughout 2021, rising from approximately 24,868 million US$ to 26,172 million US$. However, a notable decline occurred in the first half of 2022, with assets decreasing to 23,662 million US$ by June 30, 2022. Following this trough, assets rebounded significantly, climbing back to 26,411 million US$ by the first quarter of 2023. This pattern reflects a period of contraction early in 2022, possibly linked to asset disposals or market factors, followed by recovery and growth in the later quarters.
- Debt to Assets Ratio (including operating lease liability)
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The debt to assets ratio shows a consistent downward trend from 0.42 in the first quarter of 2021 to 0.35 by March 31, 2023. This decline indicates an improvement in leverage, driven primarily by the simultaneous reduction in total debt and recovery in total assets. The ratio's steady decrease underscores enhanced financial stability and a stronger equity position over the analyzed period.
In summary, the company has effectively reduced its total debt beginning in early 2022 while managing fluctuations in asset levels. The combined effect has resulted in a continuous improvement in the debt to assets ratio, suggesting an increasingly conservative and potentially less risky capital structure entering 2023.
Financial Leverage
Carrier Global Corp., financial leverage calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||
| Total assets | 26,411) | 26,086) | 25,350) | 23,662) | 24,193) | 26,172) | 25,788) | 25,738) | 24,868) | ||||
| Equity attributable to common shareowners | 8,134) | 7,758) | 7,152) | 6,696) | 7,101) | 6,767) | 6,900) | 6,756) | 6,489) | ||||
| Solvency Ratio | |||||||||||||
| Financial leverage1 | 3.25 | 3.36 | 3.54 | 3.53 | 3.41 | 3.87 | 3.74 | 3.81 | 3.83 | ||||
| Benchmarks | |||||||||||||
| Financial Leverage, Competitors2 | |||||||||||||
| Boeing Co. | — | — | — | — | — | — | — | — | — | ||||
| Caterpillar Inc. | 4.61 | 5.16 | 5.19 | 5.16 | 4.82 | 5.02 | 4.85 | 4.85 | 4.87 | ||||
| Eaton Corp. plc | 2.04 | 2.06 | 2.14 | 2.15 | 2.12 | 2.07 | 2.14 | 2.39 | 2.27 | ||||
| GE Aerospace | 5.20 | 5.16 | 5.75 | 5.35 | 4.92 | 4.93 | 6.33 | 7.09 | 7.30 | ||||
| Honeywell International Inc. | 3.54 | 3.73 | 3.40 | 3.55 | 3.45 | 3.47 | 3.60 | 3.56 | 3.53 | ||||
| Lockheed Martin Corp. | 5.66 | 5.71 | 4.35 | 4.53 | 5.15 | 4.64 | 5.38 | 7.99 | 8.15 | ||||
| RTX Corp. | 2.22 | 2.19 | 2.25 | 2.26 | 2.20 | 2.21 | 2.23 | 2.23 | 2.24 | ||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q1 2023 Calculation
Financial leverage = Total assets ÷ Equity attributable to common shareowners
= 26,411 ÷ 8,134 = 3.25
2 Click competitor name to see calculations.
- Total Assets
- The total assets exhibited a generally stable trend across the periods analyzed. From March 2021 to December 2021, assets showed moderate growth, increasing from approximately 24.9 billion US dollars to around 26.2 billion US dollars. A decline followed in the first half of 2022, reaching a low near 23.7 billion US dollars by June 2022. Subsequently, total assets recovered and increased steadily toward the end of 2022 and into the first quarter of 2023, culminating at about 26.4 billion US dollars.
- Equity Attributable to Common Shareowners
- Equity attributable to common shareowners consistently increased over the entire period. Beginning at roughly 6.5 billion US dollars in March 2021, equity rose steadily with slight fluctuations, maintaining an upward trajectory to reach approximately 8.1 billion US dollars by March 2023. Notably, there was a minor dip in June 2022; however, this did not hinder the overall growth pattern.
- Financial Leverage
- Financial leverage demonstrated a downward trend throughout the observed periods. Starting with a ratio of about 3.83 in March 2021, it remained relatively stable in 2021, with minor fluctuations between 3.74 and 3.87. In 2022, the leverage ratio began to decline more notably, falling below 3.5 by December 2022, and continued to decrease further to approximately 3.25 by March 2023. This decline indicates a reduction in the relative amount of debt employed in the capital structure during the timeline analyzed.