Microsoft Excel LibreOffice Calc

Long-term Debt and Solvency Analysis

Difficulty: Beginner


Ratios (Summary)

General Mills Inc., debt and solvency ratios

Microsoft Excel LibreOffice Calc
May 27, 2018 May 28, 2017 May 29, 2016 May 31, 2015 May 25, 2014 May 26, 2013
Debt to equity 2.58 2.19 1.71 1.85 1.34 1.19
Debt to capital 0.72 0.69 0.63 0.65 0.57 0.54
Interest coverage 6.76 8.80 8.99 6.62 9.62 8.99

Source: Based on data from General Mills Inc. Annual Reports

Ratio Description The company
Debt-to-equity ratio A solvency ratio calculated as total debt divided by total shareholders' equity. General Mills Inc.'s debt-to-equity ratio deteriorated from 2016 to 2017 and from 2017 to 2018.
Debt-to-capital ratio A solvency ratio calculated as total debt divided by total debt plus shareholders' equity. General Mills Inc.'s debt-to-capital ratio deteriorated from 2016 to 2017 and from 2017 to 2018.
Interest coverage ratio A solvency ratio calculated as EBIT divided by interest payments. General Mills Inc.'s interest coverage ratio deteriorated from 2016 to 2017 and from 2017 to 2018.

Debt to Equity

General Mills Inc., debt to equity calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 27, 2018 May 28, 2017 May 29, 2016 May 31, 2015 May 25, 2014 May 26, 2013
Selected Financial Data (USD $ in thousands)
Current portion of long-term debt 1,600,100  604,700  1,103,400  1,000,400  1,250,600  1,443,300 
Notes payable 1,549,800  1,234,100  269,800  615,800  1,111,700  599,700 
Long-term debt, excluding current portion 12,668,700  7,642,900  7,057,700  7,607,700  6,423,500  5,926,100 
Total debt 15,818,600  9,481,700  8,430,900  9,223,900  8,785,800  7,969,100 
Stockholders' equity 6,141,100  4,327,900  4,930,200  4,996,700  6,534,800  6,672,200 
Ratio
Debt to equity1 2.58 2.19 1.71 1.85 1.34 1.19
Benchmarks
Debt to Equity, Competitors
Kraft Heinz Co. 0.48 0.56 0.44
Mondelēz International Inc. 0.68 0.68 0.55 0.60 0.53
Debt to Equity, Sector
Food Producers 0.61 0.66 0.55 0.74 0.64
Debt to Equity, Industry
Consumer Goods 1.85 1.74 1.57 1.66 1.33

Source: Based on data from General Mills Inc. Annual Reports

2018 Calculations

1 Debt to equity = Total debt ÷ Stockholders' equity
= 15,818,600 ÷ 6,141,100 = 2.58

Ratio Description The company
Debt-to-equity ratio A solvency ratio calculated as total debt divided by total shareholders' equity. General Mills Inc.'s debt-to-equity ratio deteriorated from 2016 to 2017 and from 2017 to 2018.

Debt to Capital

General Mills Inc., debt to capital calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 27, 2018 May 28, 2017 May 29, 2016 May 31, 2015 May 25, 2014 May 26, 2013
Selected Financial Data (USD $ in thousands)
Current portion of long-term debt 1,600,100  604,700  1,103,400  1,000,400  1,250,600  1,443,300 
Notes payable 1,549,800  1,234,100  269,800  615,800  1,111,700  599,700 
Long-term debt, excluding current portion 12,668,700  7,642,900  7,057,700  7,607,700  6,423,500  5,926,100 
Total debt 15,818,600  9,481,700  8,430,900  9,223,900  8,785,800  7,969,100 
Stockholders' equity 6,141,100  4,327,900  4,930,200  4,996,700  6,534,800  6,672,200 
Total capital 21,959,700  13,809,600  13,361,100  14,220,600  15,320,600  14,641,300 
Ratio
Debt to capital1 0.72 0.69 0.63 0.65 0.57 0.54
Benchmarks
Debt to Capital, Competitors
Kraft Heinz Co. 0.32 0.36 0.30
Mondelēz International Inc. 0.40 0.41 0.35 0.38 0.35
Debt to Capital, Sector
Food Producers 0.38 0.40 0.35 0.43 0.39
Debt to Capital, Industry
Consumer Goods 0.65 0.63 0.61 0.62 0.57

Source: Based on data from General Mills Inc. Annual Reports

2018 Calculations

1 Debt to capital = Total debt ÷ Total capital
= 15,818,600 ÷ 21,959,700 = 0.72

Ratio Description The company
Debt-to-capital ratio A solvency ratio calculated as total debt divided by total debt plus shareholders' equity. General Mills Inc.'s debt-to-capital ratio deteriorated from 2016 to 2017 and from 2017 to 2018.

Interest Coverage

General Mills Inc., interest coverage calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 27, 2018 May 28, 2017 May 29, 2016 May 31, 2015 May 25, 2014 May 26, 2013
Selected Financial Data (USD $ in thousands)
Net earnings attributable to General Mills 2,131,000  1,657,500  1,697,400  1,221,300  1,824,400  1,855,200 
Add: Net income attributable to noncontrolling interest 32,000  43,600  39,400  38,100  36,900  37,300 
Add: Income tax expense 57,300  655,200  755,200  586,800  883,300  741,200 
Add: Interest expense, net of capitalized interest 385,400  302,100  311,900  328,600  318,500  329,500 
Earnings before interest and tax (EBIT) 2,605,700  2,658,400  2,803,900  2,174,800  3,063,100  2,963,200 
Ratio
Interest coverage1 6.76 8.80 8.99 6.62 9.62 8.99
Benchmarks
Interest Coverage, Competitors
Kraft Heinz Co. 5.48 5.43 1.77
Mondelēz International Inc. 10.15 4.49 13.95 4.28 3.35
Interest Coverage, Sector
Food Producers 6.96 5.75 5.76 5.83 4.73
Interest Coverage, Industry
Consumer Goods 11.98 13.05 11.07 11.89 12.80

Source: Based on data from General Mills Inc. Annual Reports

2018 Calculations

1 Interest coverage = EBIT ÷ Interest expense
= 2,605,700 ÷ 385,400 = 6.76

Ratio Description The company
Interest coverage ratio A solvency ratio calculated as EBIT divided by interest payments. General Mills Inc.'s interest coverage ratio deteriorated from 2016 to 2017 and from 2017 to 2018.