Peabody Energy Corp (BTU)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 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 | 1.68 | 1.74 | 2.81 | 5.02 | 2.50 |
Peabody Energy Corp's solvency ratios reflect the company's ability to meet its long-term obligations and the extent to which it relies on debt to finance its operations. The debt-to-assets, debt-to-capital, and debt-to-equity ratios have consistently been reported as 0.00 over the past five years, indicating that Peabody Energy has not had any debt relative to its assets, capital, or equity during this period.
However, the financial leverage ratio, which measures the extent to which a company is using debt to finance its operations, has varied significantly. In 2023, the financial leverage ratio was 1.68, indicating that the company's financial leverage had decreased compared to the prior year. This suggests that Peabody Energy has been less reliant on debt to fund its operations in 2023.
In comparison, the financial leverage ratio was 1.74 in 2022, 2.81 in 2021, 5.02 in 2020, and 2.50 in 2019. The notable decrease in the financial leverage ratio from 2020 to 2023 signifies a reduction in the company's debt load relative to its equity, which may imply lower financial risk and improved solvency.
Overall, based on the solvency ratios provided, Peabody Energy Corp appears to have maintained a strong financial position with minimal debt obligations relative to its assets, capital, and equity. The decreasing trend in the financial leverage ratio suggests a positive shift towards a more conservative capital structure in recent years.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 17.97 | 9.85 | 2.36 | -12.36 | -0.15 |
Peabody Energy Corp's interest coverage has shown a fluctuating trend over the past five years. The interest coverage ratio measures the company's ability to cover its interest expenses with its earnings before interest and taxes (EBIT). A higher interest coverage ratio indicates a stronger ability to meet interest payments.
In 2023, the interest coverage ratio improved significantly to 17.97, indicating a strong ability to cover interest expenses with EBIT. This is a positive trend compared to the previous year, where the ratio was 9.85.
In 2022, the ratio was 9.85, reflecting a relatively healthy interest coverage. However, in 2021, the ratio decreased to 2.36, which might have raised concerns about the company's ability to cover its interest obligations.
The interest coverage ratio was negative in 2020 and 2019, indicating that Peabody Energy Corp's EBIT was insufficient to cover its interest expenses during those years. This suggests a risky financial position where the company may have struggled to meet its interest payments.
Overall, the recent improvement in the interest coverage ratio in 2023 is a positive sign for Peabody Energy Corp's ability to manage its interest obligations. However, monitoring the ratio over time is crucial to assess the company's ongoing financial health and ability to meet its debt obligations.