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)
Phillips 66, solvency ratios (quarterly data)
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31).
The analysis of the quarterly financial data reveals several noteworthy trends in the company's capital structure and financial stability metrics over the examined periods.
- Debt to Equity Ratio
- This ratio exhibited relative stability in the initial year, fluctuating slightly around 0.39 to 0.45 through 2016 and early 2017. It peaked at 0.53 in the first quarter of 2018 before gradually declining to 0.45 by the end of 2018. Subsequently, it stabilized around the mid-0.40s range through 2019. The fluctuations indicate moderate changes in the company's leverage, with a tendency toward maintaining a consistent leverage position in recent quarters.
- Debt to Capital Ratio
- The debt to capital ratio remained close to 0.28 to 0.31 during the early part of the review period, with slight increases reaching up to 0.35 in the first quarter of 2018. Following this peak, the ratio decreased back to approximately 0.31 by the end of 2018 and held steady around 0.32 in 2019. This suggests the company maintained a balanced approach in managing its financing mix, with only minor adjustments to the relative weighting of debt in its capital structure.
- Debt to Assets Ratio
- This metric showed a gradual, modest upward trend from 0.18 at the beginning of the period to around 0.22 in early 2018. The ratio stabilized close to 0.20 towards the end of the period observed, indicating a consistent proportion of liabilities relative to total assets. The increments and subsequent stabilization reflect cautious debt management relative to asset growth.
- Financial Leverage
- The financial leverage ratio increased from around 2.12 in early 2016 to a high of 2.43 in mid-2018, followed by a decline to 2.2 at the end of 2018. It then increased again, stabilizing close to 2.36 in 2019. The pattern suggests a phase of increased utilization of debt in financing operations, followed by a partial reduction and eventual stabilization, indicating adjustments in asset financing strategies.
- Interest Coverage Ratio
- The interest coverage ratio exhibited significant volatility, starting high at 17.94 in the first quarter of 2016 but declining sharply to a low of 7.48 by year-end 2016. Thereafter, it gradually improved through 2017 and 2018, reaching a peak of 15.77 at the end of 2018. In 2019, the ratio slightly declined but remained relatively strong above 10 until the last quarter where it dropped to 10.12. This variation implies changes in earnings relative to interest expense, with temporary reductions followed by recovery, indicating improved earnings ability to cover interest obligations over most of the period.
Overall, the company maintained a moderate and stable leverage profile, with some fluctuations coinciding with changes in asset financing and earnings performance. The strengthening interest coverage in later periods points toward improved financial resilience and capacity to service debt despite varying leverage levels.
Debt Ratios
Coverage Ratios
Debt to Equity
Phillips 66, debt to equity calculation (quarterly data)
| 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 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Short-term debt | 547) | 842) | 667) | 30) | 67) | 316) | 341) | 42) | 41) | 706) | 493) | 609) | 550) | 1,583) | 1,532) | 32) | |||||
| Long-term debt | 11,216) | 11,083) | 10,772) | 11,268) | 11,093) | 11,021) | 11,023) | 11,579) | 10,069) | 9,495) | 9,472) | 9,601) | 9,588) | 7,275) | 7,330) | 8,803) | |||||
| Total debt | 11,763) | 11,925) | 11,439) | 11,298) | 11,160) | 11,337) | 11,364) | 11,621) | 10,110) | 10,201) | 9,965) | 10,210) | 10,138) | 8,858) | 8,862) | 8,835) | |||||
| Stockholders’ equity | 24,910) | 24,857) | 24,752) | 24,217) | 24,653) | 23,319) | 22,536) | 21,923) | 25,085) | 22,523) | 22,368) | 22,364) | 22,390) | 22,905) | 22,842) | 22,788) | |||||
| Solvency Ratio | |||||||||||||||||||||
| Debt to equity1 | 0.47 | 0.48 | 0.46 | 0.47 | 0.45 | 0.49 | 0.50 | 0.53 | 0.40 | 0.45 | 0.45 | 0.46 | 0.45 | 0.39 | 0.39 | 0.39 | |||||
| Benchmarks | |||||||||||||||||||||
| Debt to Equity, Competitors2 | |||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31).
1 Q4 2019 Calculation
Debt to equity = Total debt ÷ Stockholders’ equity
= 11,763 ÷ 24,910 = 0.47
2 Click competitor name to see calculations.
- Total Debt
- The total debt remained relatively stable between early 2016 and late 2017, fluctuating around the 8,800 to 10,200 million US dollar range. A noticeable increase began around early 2018, with the total debt peaking at 11,621 million by March 2018. Subsequent quarters showed a slight decline and some fluctuations, but the debt level generally remained above 11,000 million from 2018 through the end of 2019.
- Stockholders’ Equity
- Stockholders' equity showed moderate variability during the period. From early 2016 to late 2017, equity mostly hovered between 22,300 and 25,000 million US dollars, with an upward spike in December 2017 reaching around 25,085 million. In 2018, equity values dipped to a low point near 21,923 million in March but then demonstrated a steady upward trend, increasing to nearly 24,910 million by the end of 2019.
- Debt to Equity Ratio
- The debt to equity ratio fluctuated within a limited range throughout the examined timeframe. Starting at 0.39 in the first quarter of 2016, it increased steadily to 0.46 by early 2017. A decline followed, reaching approximately 0.40 by the end of 2017. During 2018, the ratio peaked at 0.53, indicating higher leverage, but gradually decreased over 2019, stabilizing around 0.47 by the final quarter. This trend reflects periods of increased leverage, especially in early 2018, followed by efforts to reduce the relative debt levels in the subsequent periods.
Debt to Capital
Phillips 66, debt to capital calculation (quarterly data)
| 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 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Short-term debt | 547) | 842) | 667) | 30) | 67) | 316) | 341) | 42) | 41) | 706) | 493) | 609) | 550) | 1,583) | 1,532) | 32) | |||||
| Long-term debt | 11,216) | 11,083) | 10,772) | 11,268) | 11,093) | 11,021) | 11,023) | 11,579) | 10,069) | 9,495) | 9,472) | 9,601) | 9,588) | 7,275) | 7,330) | 8,803) | |||||
| Total debt | 11,763) | 11,925) | 11,439) | 11,298) | 11,160) | 11,337) | 11,364) | 11,621) | 10,110) | 10,201) | 9,965) | 10,210) | 10,138) | 8,858) | 8,862) | 8,835) | |||||
| Stockholders’ equity | 24,910) | 24,857) | 24,752) | 24,217) | 24,653) | 23,319) | 22,536) | 21,923) | 25,085) | 22,523) | 22,368) | 22,364) | 22,390) | 22,905) | 22,842) | 22,788) | |||||
| Total capital | 36,673) | 36,782) | 36,191) | 35,515) | 35,813) | 34,656) | 33,900) | 33,544) | 35,195) | 32,724) | 32,333) | 32,574) | 32,528) | 31,763) | 31,704) | 31,623) | |||||
| Solvency Ratio | |||||||||||||||||||||
| Debt to capital1 | 0.32 | 0.32 | 0.32 | 0.32 | 0.31 | 0.33 | 0.34 | 0.35 | 0.29 | 0.31 | 0.31 | 0.31 | 0.31 | 0.28 | 0.28 | 0.28 | |||||
| Benchmarks | |||||||||||||||||||||
| Debt to Capital, Competitors2 | |||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31).
1 Q4 2019 Calculation
Debt to capital = Total debt ÷ Total capital
= 11,763 ÷ 36,673 = 0.32
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends regarding the company's capital structure between March 2016 and December 2019.
- Total Debt
-
Total debt remained relatively stable throughout the initial quarters of 2016, hovering slightly below 9 billion US dollars. A marked increase occurred toward the end of 2016, with debt rising to over 10 billion US dollars by December 31, 2016. This elevated level of debt persisted with moderate fluctuation, peaking in September 2019 at approximately 11.9 billion US dollars before slightly contracting toward the end of 2019.
- Total Capital
-
Total capital exhibited consistent growth over the analyzed period, rising from about 31.6 billion US dollars in early 2016 to a peak of nearly 35.2 billion US dollars in late 2017. After a slight decline in early 2018, total capital resumed its upward trend, reaching approximately 36.7 billion US dollars by the end of 2019. This indicates an overall expansion in the company's capital base across the nearly four-year span.
- Debt to Capital Ratio
-
The debt to capital ratio remained steady in the low 0.28–0.31 range from March 2016 through the end of 2017, implying a stable balance between debt and equity financing during this period. Beginning in early 2018, the ratio increased noticeably to a high of 0.35, indicating a relative rise in leverage. However, this ratio gradually moderated to about 0.32 by the end of 2019, suggesting a slight deleveraging or improved capital structure management.
In summary, the company demonstrated controlled growth in total capital with a tendency to increase debt moderately. The leverage ratio reflected a temporary rise in debt reliance around 2018, followed by a stabilization phase, implying attentive capital management during the latter periods. These patterns suggest a strategic approach to balancing debt and equity to support the company’s capital needs.
Debt to Assets
Phillips 66, debt to assets calculation (quarterly data)
| 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 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Short-term debt | 547) | 842) | 667) | 30) | 67) | 316) | 341) | 42) | 41) | 706) | 493) | 609) | 550) | 1,583) | 1,532) | 32) | |||||
| Long-term debt | 11,216) | 11,083) | 10,772) | 11,268) | 11,093) | 11,021) | 11,023) | 11,579) | 10,069) | 9,495) | 9,472) | 9,601) | 9,588) | 7,275) | 7,330) | 8,803) | |||||
| Total debt | 11,763) | 11,925) | 11,439) | 11,298) | 11,160) | 11,337) | 11,364) | 11,621) | 10,110) | 10,201) | 9,965) | 10,210) | 10,138) | 8,858) | 8,862) | 8,835) | |||||
| Total assets | 58,720) | 58,741) | 57,781) | 57,855) | 54,302) | 55,884) | 54,826) | 52,132) | 54,371) | 52,712) | 51,828) | 51,405) | 51,653) | 50,254) | 50,361) | 48,246) | |||||
| Solvency Ratio | |||||||||||||||||||||
| Debt to assets1 | 0.20 | 0.20 | 0.20 | 0.20 | 0.21 | 0.20 | 0.21 | 0.22 | 0.19 | 0.19 | 0.19 | 0.20 | 0.20 | 0.18 | 0.18 | 0.18 | |||||
| Benchmarks | |||||||||||||||||||||
| Debt to Assets, Competitors2 | |||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31).
1 Q4 2019 Calculation
Debt to assets = Total debt ÷ Total assets
= 11,763 ÷ 58,720 = 0.20
2 Click competitor name to see calculations.
- Total Debt
- The total debt demonstrates a generally upward trend throughout the observed periods, with values increasing from approximately $8.8 billion in early 2016 to a peak near $12 billion by late 2019. Notably, there is a significant rise between late 2016 and early 2018, followed by relatively stable levels with minor fluctuations around the $11 to $12 billion range in 2018 and 2019.
- Total Assets
- Total assets show a gradual increase over the timeframe, moving from about $48 billion in early 2016 to nearly $59 billion by the end of 2019. This growth is steady with some quarterly variations, including moderate increases in most quarters, particularly evident in the periods around mid-2017 and early 2019.
- Debt to Assets Ratio
- The debt to assets ratio remains relatively stable across all quarters, generally oscillating between 0.18 and 0.22. There is a slight upward movement in the ratio from 0.18 in early 2016 to about 0.20-0.22 in later years, indicating that debt levels have increased proportionally somewhat more than assets. This suggests a consistent leverage profile with moderate use of debt financing relative to asset growth.
- Overall Financial Position
- The data indicates a steady increase in both assets and debt, with the proportionate use of debt remaining controlled. The company appears to maintain a balanced leverage strategy, with incremental asset growth supporting the increase in liabilities. The relatively stable debt to assets ratio implies prudent financial management without significant escalation in financial risk over the period analyzed.
Financial Leverage
Phillips 66, financial leverage calculation (quarterly data)
| Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Total assets | 58,720) | 58,741) | 57,781) | 57,855) | 54,302) | 55,884) | 54,826) | 52,132) | 54,371) | 52,712) | 51,828) | 51,405) | 51,653) | 50,254) | 50,361) | 48,246) | |||||
| Stockholders’ equity | 24,910) | 24,857) | 24,752) | 24,217) | 24,653) | 23,319) | 22,536) | 21,923) | 25,085) | 22,523) | 22,368) | 22,364) | 22,390) | 22,905) | 22,842) | 22,788) | |||||
| Solvency Ratio | |||||||||||||||||||||
| Financial leverage1 | 2.36 | 2.36 | 2.33 | 2.39 | 2.20 | 2.40 | 2.43 | 2.38 | 2.17 | 2.34 | 2.32 | 2.30 | 2.31 | 2.19 | 2.20 | 2.12 | |||||
| Benchmarks | |||||||||||||||||||||
| Financial Leverage, Competitors2 | |||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31).
1 Q4 2019 Calculation
Financial leverage = Total assets ÷ Stockholders’ equity
= 58,720 ÷ 24,910 = 2.36
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends regarding the assets, equity, and leverage of the company over the examined periods.
- Total assets
- The total assets exhibit a generally increasing trend throughout the quarters from March 2016 to December 2019. Starting at approximately US$48.2 billion, total assets rose steadily with minor fluctuations, peaking around US$58.7 billion at the end of 2019. This growth suggests an expansion in the company's asset base over the nearly four-year period, with occasional quarters showing small declines or slower growth, such as between June 2018 and December 2018.
- Stockholders’ equity
- Stockholders’ equity shows more fluctuation relative to total assets. Initial values around US$22.8 billion remain relatively stable in 2016 and early 2017, followed by a moderate rise towards the end of 2017 reaching about US$25.1 billion. After a decline in early 2018, equity values trend upward again toward late 2018 and throughout 2019, peaking near US$24.9 billion by the last quarter. The variations indicate changes in retained earnings or equity transactions impacting shareholder value across the periods.
- Financial leverage
- The financial leverage ratio, defined as total assets divided by stockholders' equity, generally stays above 2.1 and fluctuates slightly throughout the timeframe. The ratio peaks around mid-2018 and again in some quarters of 2019, suggesting increased use of liabilities relative to equity during these times. The lowest leverage noted is around 2.12, and the highest approaches 2.43, indicating a moderate but consistent reliance on debt or other liabilities to finance assets.
Overall, the data reflects a company progressively growing its asset base while maintaining equity levels with moderate increases. The financial leverage suggests prudent use of debt financing, with periods of slightly higher leverage possibly linked to strategic investments or operating conditions. The combined trends indicate careful balance maintaining asset growth while managing equity and liabilities efficiently.
Interest Coverage
Phillips 66, interest coverage calculation (quarterly data)
| Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Net income attributable to Phillips 66 | 736) | 712) | 1,424) | 204) | 2,240) | 1,492) | 1,339) | 524) | 3,198) | 823) | 550) | 535) | 163) | 511) | 496) | 385) | |||||
| Add: Net income attributable to noncontrolling interest | 74) | 81) | 80) | 66) | 76) | 76) | 65) | 61) | 57) | 26) | 31) | 28) | 31) | 25) | 20) | 13) | |||||
| Add: Income tax expense | 256) | 150) | 325) | 70) | 602) | 407) | 431) | 132) | (2,601) | 407) | 267) | 234) | (132) | 277) | 204) | 198) | |||||
| Add: Interest and debt expense | 115) | 109) | 115) | 119) | 121) | 125) | 135) | 123) | 114) | 112) | 107) | 105) | 88) | 81) | 83) | 86) | |||||
| Earnings before interest and tax (EBIT) | 1,181) | 1,052) | 1,944) | 459) | 3,039) | 2,100) | 1,970) | 840) | 768) | 1,368) | 955) | 902) | 150) | 894) | 803) | 682) | |||||
| Solvency Ratio | |||||||||||||||||||||
| Interest coverage1 | 10.12 | 14.00 | 15.71 | 15.14 | 15.77 | 11.42 | 10.22 | 8.62 | 9.12 | 8.19 | 7.61 | 7.70 | 7.48 | 10.14 | 15.35 | 17.94 | |||||
| Benchmarks | |||||||||||||||||||||
| Interest Coverage, Competitors2 | |||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31).
1 Q4 2019 Calculation
Interest coverage
= (EBITQ4 2019
+ EBITQ3 2019
+ EBITQ2 2019
+ EBITQ1 2019)
÷ (Interest expenseQ4 2019
+ Interest expenseQ3 2019
+ Interest expenseQ2 2019
+ Interest expenseQ1 2019)
= (1,181 + 1,052 + 1,944 + 459)
÷ (115 + 109 + 115 + 119)
= 10.12
2 Click competitor name to see calculations.
- Earnings before interest and tax (EBIT)
- The EBIT shows notable fluctuations over the analyzed quarters, with a general upward trend punctuated by significant variability. Starting at 682 million USD in March 2016, EBIT increased steadily to a peak of 3039 million USD by September 2018. However, this peak was followed by a sharp decline to 459 million USD in December 2018. Subsequently, EBIT rebounded to 1944 million USD by March 2019 but then decreased again towards the end of 2019, stabilizing around the 1000 to 1200 million USD range. These variations indicate periods of both strong operational performance and potential challenges affecting earnings.
- Interest and debt expense
- The interest and debt expense increased gradually over the period, beginning at 86 million USD in March 2016 and rising to around 115 million USD by the end of 2019. This steady increase suggests a slight growth in debt-related costs, which may be attributed to increased borrowings or changes in interest rates. Despite the rise, the changes in interest expense were relatively moderate compared to fluctuations in EBIT.
- Interest coverage ratio
- The interest coverage ratio, which measures the ability to service debt through operating earnings, exhibited considerable variation. Initially quite high at 17.94 in March 2016, the ratio declined to a low of 7.48 by December 2016, reflecting tighter coverage. From 2017 onward, the coverage ratio improved, reaching a high of 15.77 in December 2018, coinciding with a peak in EBIT. Following this peak, the ratio decreased again to approximately 10.12 by the end of 2019. Overall, the interest coverage ratio remained above 7, indicating satisfactory coverage of interest expenses despite the volatility in earnings.