Acuity Brands Inc (AYI)
Solvency ratios
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.14 | 0.14 | 0.15 | 0.14 | 0.15 | 0.14 | 0.14 | 0.14 | 0.13 | 0.14 | 0.14 | 0.14 | 0.15 | 0.15 | 0.11 | 0.11 | 0.12 | 0.11 | 0.11 | 0.11 |
| Debt-to-capital ratio | 0.19 | 0.19 | 0.20 | 0.20 | 0.20 | 0.21 | 0.21 | 0.21 | 0.19 | 0.19 | 0.19 | 0.20 | 0.20 | 0.20 | 0.15 | 0.16 | 0.16 | 0.15 | 0.15 | 0.16 |
| Debt-to-equity ratio | 0.23 | 0.24 | 0.25 | 0.25 | 0.25 | 0.26 | 0.26 | 0.26 | 0.24 | 0.24 | 0.24 | 0.24 | 0.26 | 0.26 | 0.18 | 0.18 | 0.19 | 0.17 | 0.18 | 0.18 |
| Financial leverage ratio | 1.64 | 1.68 | 1.69 | 1.75 | 1.74 | 1.81 | 1.82 | 1.88 | 1.75 | 1.74 | 1.75 | 1.75 | 1.74 | 1.75 | 1.64 | 1.64 | 1.66 | 1.66 | 1.65 | 1.66 |
Acuity Brands Inc's solvency ratios provide insight into the company's ability to meet its long-term financial obligations.
The debt-to-assets ratio has remained relatively stable around 0.14 to 0.15 over the past few quarters, indicating that the company relies on debt for only a small portion of its total assets.
The debt-to-capital ratio and debt-to-equity ratio have also shown consistency, hovering around 0.19 to 0.20 and 0.23 to 0.25 respectively. These ratios suggest that Acuity Brands Inc finances its operations primarily through equity rather than debt.
The financial leverage ratio, on the other hand, has fluctuated between 1.64 to 1.88. A higher financial leverage ratio indicates higher reliance on debt financing, which could pose higher financial risk for the company if not managed effectively.
Overall, based on the solvency ratios, Acuity Brands Inc appears to have a stable financial structure with a conservative approach to debt financing. However, fluctuations in the financial leverage ratio warrant further monitoring to ensure the company maintains a healthy level of long-term solvency.
Coverage ratios
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 20.47 | 19.35 | 17.01 | 17.56 | 17.37 | 17.66 | 19.29 | 19.83 | 18.82 | 17.83 | 17.37 | 17.08 | 15.93 | 15.67 | 13.30 | 12.25 | 12.24 | 11.84 | 12.67 | 13.06 |
Acuity Brands Inc has displayed consistently strong interest coverage ratios over the past few years, indicating the company's ability to comfortably meet its interest payment obligations. The interest coverage ratios have generally been well above 10, which is considered a healthy threshold.
The company's interest coverage ratio has shown a gradual increasing trend from 13.06 in November 2019 to 20.47 in February 2024, with occasional fluctuations in between. This improvement suggests that Acuity Brands Inc has been effectively managing its interest expenses relative to its operating income.
Overall, the strong and improving interest coverage ratios reflect Acuity Brands Inc's financial stability and capacity to service its debt obligations. Investors and creditors may view this trend positively as it indicates the company's ability to generate sufficient earnings to cover its interest expenses.