Axalta Coating Systems Ltd (AXTA)
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 | 0.47 | 0.00 | 0.00 | 0.00 | 0.48 | 0.00 | 0.00 | 0.00 | 0.52 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.64 | 0.00 | 0.00 | 0.00 | 0.67 | 0.00 | 0.00 | 0.00 | 0.72 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 1.78 | 0.00 | 0.00 | 0.00 | 2.01 | 0.00 | 0.00 | 0.00 | 2.53 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 3.79 | 3.94 | 4.12 | 4.10 | 4.21 | 4.36 | 4.28 | 4.46 | 4.86 | 5.36 | 5.23 | 5.15 | 4.83 | 5.02 | 4.84 | 5.16 | 4.99 | 5.25 | 5.50 | 4.95 |
Axalta Coating Systems Ltd has shown a stable debt-to-assets ratio, indicating that the company has been effectively managing its debt in relation to its total assets. In December 2024, the debt-to-assets ratio slightly increased to 0.47, which suggests a small portion of assets are financed by debt.
The debt-to-capital ratio has also been well-controlled, remaining at a low level throughout the period. In December 2024, the ratio stood at 0.64, implying that debt represented 64% of the company's capital structure, leaving a significant portion of capital financed through equity.
The debt-to-equity ratio shows a similar pattern of low debt utilization in the capital structure of Axalta Coating Systems Ltd. In December 2024, the ratio was 1.78, indicating that the company relied more on equity financing compared to debt for its operations.
The financial leverage ratio provides a measure of the company's financial risk, and Axalta Coating Systems Ltd has managed to keep this ratio relatively stable over the analyzed period. The decreasing trend in the ratio from 2022 to 2024 indicates a declining reliance on debt to finance operations, which could signify improved financial stability and lower financial risk for the company.
Overall, based on the solvency ratios analyzed, Axalta Coating Systems Ltd appears to have a sound financial position with conservative debt levels and strong capital structure, contributing to a stable and manageable level of financial leverage.
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 | 3.41 | 3.14 | 2.96 | 2.55 | 2.66 | 2.58 | 2.65 | 2.81 | 2.84 | 2.95 | 3.03 | 3.80 | 3.53 | 3.68 | 3.61 | 1.77 | 1.81 | 1.64 | 1.54 | 2.88 |
Interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt. It is calculated by dividing the earnings before interest and taxes (EBIT) by the interest expense. A higher interest coverage ratio indicates a stronger ability to cover interest payments.
For Axalta Coating Systems Ltd, the interest coverage ratio has fluctuated over the given periods but generally improved from March 31, 2020, to December 31, 2024. The ratio ranged from a low of 1.54 on June 30, 2020, to a high of 3.80 on March 31, 2022. This improvement suggests that the company's earnings relative to its interest expense have strengthened over time, indicating a better ability to fulfill its interest obligations using its operational profits.
However, it's worth noting that the interest coverage ratio dipped below 2.0 at times, such as in September 30, 2020, and September 30, 2022. This could potentially signal a higher risk for the company in meeting its interest payments during those periods. Overall, the gradual improvement in the interest coverage ratio demonstrates a positive trend in Axalta Coating Systems Ltd's ability to manage its debt burden.