Aramark Holdings (ARMK)
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 | 4.54 | 4.98 | 5.28 | 5.74 | 4.14 |
The solvency ratios of Aramark Holdings indicate a consistent and stable financial position with respect to debt obligations and leverage over the past five years. The debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio are all at 0.00, suggesting that the company has not utilized debt extensively to finance its operations and investments during this period.
On the other hand, the financial leverage ratio has shown some variability, decreasing from 5.74 in 2020 to 4.14 in 2019, and then increasing to 4.98 in 2022 before declining to 4.54 in 2023. This ratio measures the extent to which a company has used debt to finance its assets, with higher values indicating greater reliance on debt. Despite the fluctuations, the financial leverage ratio remains within a manageable range, reflecting Aramark Holdings' ability to effectively manage its debt levels in relation to its capital structure.
Overall, the solvency ratios of Aramark Holdings suggest a prudent approach to managing debt and leverage, with a consistent focus on maintaining a strong financial position.
Coverage ratios
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 2.93 | 1.67 | 0.68 | -0.66 | 2.58 |
The interest coverage ratio for Aramark Holdings has shown fluctuations over the past five years. In 2023, the interest coverage ratio improved significantly to 2.93, indicating the company's ability to cover its interest expenses nearly three times. This improvement from the previous year suggests better earnings and cash flow to meet interest obligations.
In 2022, the interest coverage ratio was 1.67, indicating a moderate ability to cover interest expenses. However, the ratio in 2021 was relatively low at 0.68, signifying tighter financial conditions and potentially increased risk associated with the company's debt obligations.
In 2020, the interest coverage ratio was negative at -0.66, which suggests that the company's operating earnings were insufficient to cover its interest expenses during that period. This is a concerning sign as it indicates a potential risk of default on debt payments.
In contrast, in 2019, the interest coverage ratio was a healthy 2.58, indicating a comfortable ability to cover interest expenses. Overall, the trend in the interest coverage ratio for Aramark Holdings has been mixed, with fluctuations reflecting changes in the company's financial performance and ability to service its debt.