Aptiv PLC (APTV)

Solvency ratios

	Dec 31, 2024	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
Debt-to-assets ratio	0.33	0.33	0.22	0.20	0.25	0.27	0.29	0.30	0.30	0.32	0.32	0.32	0.23	0.23	0.23	0.23	0.23	0.24	0.26	0.37
Debt-to-capital ratio	0.47	0.48	0.32	0.30	0.35	0.37	0.41	0.42	0.42	0.44	0.44	0.44	0.33	0.33	0.33	0.33	0.34	0.35	0.36	0.55
Debt-to-equity ratio	0.89	0.93	0.48	0.42	0.54	0.60	0.70	0.72	0.73	0.77	0.79	0.77	0.49	0.48	0.48	0.49	0.51	0.53	0.57	1.20
Financial leverage ratio	2.67	2.79	2.16	2.13	2.12	2.20	2.39	2.42	2.48	2.44	2.46	2.43	2.16	2.13	2.14	2.16	2.22	2.23	2.20	3.25

Aptiv PLC's solvency ratios provide insights into the company's financial health and ability to meet its long-term obligations.

1. Debt-to-assets ratio: Over the period analyzed, the debt-to-assets ratio fluctuated but generally decreased from 0.37 in March 2020 to 0.20 in March 2024. This indicates that the company's level of debt relative to its total assets reduced over time, which could signal improved financial stability and lower risk.

2. Debt-to-capital ratio: Similarly, the debt-to-capital ratio followed a downward trend from 0.55 in March 2020 to 0.30 in March 2024. This implies that Aptiv's dependence on debt funding compared to its total capital decreased, which is positive as it shows a strengthened capital structure.

3. Debt-to-equity ratio: The debt-to-equity ratio also declined from 1.20 in March 2020 to 0.42 in March 2024. This suggests that the company relied less on debt financing in relation to equity, reflecting a lower financial risk and potentially increased shareholder value.

4. Financial leverage ratio: Aptiv's financial leverage ratio decreased from 3.25 in March 2020 to 2.67 in December 2024. This reduction indicates that the proportion of debt in the company's capital structure declined over time, which may imply a decrease in financial risk and enhanced stability.

Overall, the decreasing trends in these solvency ratios suggest that Aptiv PLC has been effectively managing its debt levels and enhancing its financial strength over the analyzed period. These improvements can potentially lead to increased investor confidence and better long-term sustainability of the business.

Coverage ratios

	Dec 31, 2024	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
Interest coverage	7.10	27.08	7.47	4.76	4.39	4.84	5.25	4.30	4.26	3.45	2.39	3.99	5.61	7.63	8.65	4.81	12.30	11.60	11.27	15.38

Aptiv PLC's interest coverage ratio provides insight into the company's ability to cover its interest expenses with its operating income. The trend of the interest coverage ratio over the past few quarters indicates the company's financial strength and ability to meet its debt obligations.

Looking at the data provided, we see that the interest coverage ratio has fluctuated over the quarters, ranging from a high of 27.08 in September 30, 2024, to a low of 2.39 in June 30, 2022. Generally, a higher interest coverage ratio indicates a better ability to meet interest obligations, while a lower ratio may signal potential financial risk.

The significant increase in the interest coverage ratio to 27.08 in September 30, 2024, may indicate a strong performance, with operating income comfortably covering interest expenses. This sharp improvement from previous quarters suggests an improvement in Aptiv PLC's financial health and debt-servicing capabilities.

However, fluctuations in the interest coverage ratio over time, including the notable decline in the ratio from the peak, should be monitored closely. A declining interest coverage ratio could indicate increasing financial leverage and potentially raise concerns about the company's ability to service its debt in the future.

In conclusion, while the interest coverage ratio for Aptiv PLC has shown variability, the recent spike in the ratio to 27.08 in September 30, 2024, highlights improved financial stability and the company's ability to manage its interest obligations effectively. Ongoing monitoring of this ratio will be crucial to assess the company's financial health and debt management strategies.