Adient PLC (ADNT)
Solvency ratios
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 4.23 | 4.42 | 4.54 | 8.46 | 5.60 |
The solvency ratios reflect Adient plc's ability to meet its long-term financial obligations and the extent to which the company is reliant on debt financing.
The debt-to-assets ratio, which measures the proportion of assets financed by debt, has shown a decreasing trend over the past five years, dropping from 0.42 in 2020 to 0.27 in 2023. This indicates a more conservative approach to leveraging assets.
The debt-to-capital ratio, which indicates the proportion of capital that is debt, also displays a declining trend, falling from 0.78 in 2020 to 0.53 in 2023. This suggests a decreasing reliance on debt as a source of capital.
The debt-to-equity ratio, a measure of the extent to which a company is financing its operations through debt, has shown a significant improvement, decreasing from 3.55 in 2020 to 1.14 in 2023. This suggests a reduction in the reliance on debt financing relative to equity.
The financial leverage ratio, which indicates the extent to which the company's operations are funded by equity versus debt, has also shown a decreasing trend, dropping from 8.46 in 2020 to 4.23 in 2023. This indicates a reduction in the company's reliance on debt to fund its operations.
Overall, the declining trend in these solvency ratios suggests that Adient plc has been effectively managing its debt levels and moving towards a more conservative capital structure, which may enhance the company's long-term financial stability.
Coverage ratios
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 2.55 | 0.86 | 6.93 | -1.41 | 0.41 |
The interest coverage ratio of Adient plc has exhibited significant fluctuations over the past five years. In 2023, the interest coverage ratio improved to 3.43, representing an increase from the prior year. This indicates that the company's ability to meet its interest obligations with its earnings has strengthened. However, it is noteworthy that in 2020, the interest coverage ratio was notably low at 0.25, which may have raised concerns about the company's ability to cover its interest expenses. The substantial fluctuations in the interest coverage ratio suggest a degree of volatility in the company's ability to service its debt obligations from its earnings.