Archer-Daniels-Midland Company (ADM)

Solvency ratios

Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 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 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019
Debt-to-assets ratio 0.15 0.16 0.15 0.15 0.15 0.15 0.13 0.13 0.13 0.13 0.13 0.14 0.15 0.17 0.16 0.16 0.18 0.19 0.18 0.17
Debt-to-capital ratio 0.26 0.27 0.26 0.28 0.25 0.25 0.24 0.26 0.24 0.25 0.27 0.27 0.27 0.28 0.29 0.28 0.29 0.31 0.31 0.36
Debt-to-equity ratio 0.34 0.37 0.36 0.39 0.33 0.33 0.31 0.34 0.32 0.33 0.37 0.36 0.37 0.39 0.40 0.39 0.41 0.45 0.45 0.56
Financial leverage ratio 2.38 2.38 2.36 2.55 2.18 2.23 2.37 2.65 2.43 2.53 2.73 2.53 2.38 2.36 2.47 2.49 2.32 2.30 2.55 3.19

Archer-Daniels-Midland Company's solvency ratios indicate the company's ability to meet its long-term financial obligations. The debt-to-assets ratio has remained relatively stable around 0.15, indicating that the company relies on debt for about 15% of its total assets. This suggests a conservative level of leverage compared to its asset base.

The debt-to-capital ratio has also shown stability, hovering around 0.26 to 0.27, reflecting that debt constitutes about 26-27% of the company's total capital structure. This ratio indicates the extent to which debt is used to finance the company's operations relative to equity.

The debt-to-equity ratio has fluctuated over time but generally stayed in the range of 0.32 to 0.45, with periods of increase and decrease. This ratio reflects how much debt the company has compared to shareholder equity, with higher values indicating higher reliance on debt for financing.

The financial leverage ratio has shown some volatility, with a range from 2.18 to 3.19. This ratio provides insight into the overall financial risk of the company, with higher values indicating higher financial risk due to increased debt levels.

Overall, Archer-Daniels-Midland Company maintains a moderate level of leverage, with varying levels of reliance on debt for funding its operations over the analyzed periods. The company's solvency ratios demonstrate a balanced approach to managing its long-term financial obligations.

Coverage ratios

Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 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 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019
Interest coverage 4.41 5.88 6.72 7.66 8.73 9.89 12.84 14.15 15.74 15.58 14.81 13.40 12.83 9.76 7.76 6.53 5.45 6.32 5.29 4.95

Archer-Daniels-Midland Company's interest coverage ratio has demonstrated a fluctuating trend over the analyzed periods. The ratio, which indicates the company's ability to cover its interest payments from its operating income, has generally remained above 4, reflecting a moderate level of safety for creditors.

The interest coverage ratio peaked at 15.74 in the third quarter of 2022, showcasing a strong ability to service its interest obligations with operating profits. This was followed by a slight decline, but the ratio remained relatively high until the fourth quarter of 2023.

From the fourth quarter of 2023 onwards, there was a noticeable decrease in the interest coverage ratio, reaching a low of 4.41 in the third quarter of 2024. This declining trend could suggest a potential strain on the company's ability to cover interest expenses with its operating income.

It is important for stakeholders to closely monitor this trend in interest coverage ratio over future periods to gauge the company's financial health and debt repayment capability. Additionally, any insights into the reasons behind the decreasing ratio would be crucial in assessing the company's overall financial sustainability.