Carnival Corporation (CCL)
Solvency ratios
| Nov 30, 2023 | Nov 30, 2022 | Nov 30, 2021 | Nov 30, 2020 | Nov 30, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.58 | 0.62 | 0.53 | 0.41 | 0.21 |
| Debt-to-capital ratio | 0.81 | 0.82 | 0.70 | 0.52 | 0.28 |
| Debt-to-equity ratio | 4.14 | 4.52 | 2.35 | 1.08 | 0.38 |
| Financial leverage ratio | 7.14 | 7.32 | 4.39 | 2.61 | 1.78 |
The solvency ratios of Carnival Corp. indicate its ability to meet its long-term financial obligations and the extent of its financial leverage.
The debt-to-assets ratio has fluctuated over the years, indicating the proportion of the company's assets financed by debt. It decreased from 0.67 in 2022 to 0.62 in 2023, and this suggests a lower reliance on debt to fund its assets.
The debt-to-capital ratio, which measures the proportion of a company's capital that is financed by debt, has also shown a slight decrease from 0.83 in 2022 to 0.82 in 2023. This suggests a relatively stable capital structure with a slightly lower reliance on debt financing.
The debt-to-equity ratio has increased over the years, reaching 4.44 in 2023. This indicates a higher level of financial risk, as the company's debt level relative to its equity has increased significantly.
The financial leverage ratio, which measures the extent to which the company is using debt to finance its assets, has also shown an upward trend, reaching 7.14 in 2023. This suggests that the company's reliance on debt financing has increased substantially over the years.
Overall, while the debt-to-assets and debt-to-capital ratios indicate some stability in the company's debt financing, the increasing debt-to-equity and financial leverage ratios raise concerns about the company's increasing financial risk and reliance on debt to support its assets and operations.
Coverage ratios
| Nov 30, 2023 | Nov 30, 2022 | Nov 30, 2021 | Nov 30, 2020 | Nov 30, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 0.97 | -2.78 | -4.95 | -10.46 | 15.86 |
The interest coverage ratio for Carnival Corp. has been fluctuating over the past five years. In 2019, the ratio was quite healthy at 17.91, indicating that the company's earnings were significantly higher than its interest expenses. However, there has been a notable decline in subsequent years, with the ratio falling into negative territory in 2020, 2021, and 2022. This negative trend suggests that the company's earnings were insufficient to cover its interest expenses during these years. In 2023, there was an improvement in the interest coverage ratio to 1.07, although it still remains relatively low. This indicates that while the company's earnings have improved, they are still only slightly higher than its interest expenses. Overall, the declining trend in the interest coverage ratio raises concerns about Carnival Corp.'s ability to meet its interest obligations from its earnings.