Century Aluminum Company (CENX)

Century Aluminum Company's solvency ratios provide insight into the company's ability to meet its long-term financial obligations. The trend analysis of the solvency ratios over the past few quarters shows some fluctuations:

1. Debt-to-assets ratio: This ratio indicates the proportion of total assets financed by debt. Century Aluminum's debt-to-assets ratio has been relatively stable, ranging from 0.16 to 0.28. The company's highest debt-to-assets ratio was in March 2023 at 0.28, suggesting that 28% of its assets were funded by debt.

2. Debt-to-capital ratio: This ratio reflects the percentage of capital structure financed by debt. Century Aluminum's debt-to-capital ratio shows variability over the quarters, ranging from 0.25 to 0.55. The highest ratio was in December 2023 at 0.55, indicating that 55% of the company's capital structure was debt-financed.

3. Debt-to-equity ratio: This ratio signifies the extent to which a company is leveraging its equity. Century Aluminum's debt-to-equity ratio has also fluctuated, ranging from 0.34 to 1.21. The highest debt-to-equity ratio was in December 2023 at 1.21, implying that the company had $1.21 in debt for every $1 of equity.

4. Financial leverage ratio: This ratio indicates the extent of the company's financial leverage. Century Aluminum's financial leverage ratio shows variability, ranging from 2.10 to 5.28. The highest ratio was in September 2023 at 5.28, suggesting a higher level of financial leverage during that period.

In conclusion, Century Aluminum's solvency ratios have shown fluctuations over the quarters, with varying levels of debt utilization, capital structure financing, leverage, and debt-to-equity proportions. It is essential for investors and stakeholders to closely monitor these ratios to assess the company's financial health and risk levels.

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Coverage ratios

The interest coverage ratio measures a company's ability to pay its interest expenses on outstanding debt. A higher ratio indicates a stronger ability to meet interest obligations. Based on the data provided for Century Aluminum Company, the interest coverage ratio fluctuated over the time periods analyzed.

The interest coverage ratios for the company varied from negative values to positive values. A negative interest coverage ratio, such as seen in some quarters, indicates that the company's earnings were insufficient to cover its interest payments. This could raise concerns about the company's financial health and its ability to service its debt obligations.

The ratios for Century Aluminum Company ranged from -6.64 to 6.49, showing significant fluctuations. The negative ratios in some periods suggest potential financial distress, while the positive ratios in other periods indicate an improved ability to cover interest expenses.

It is important to note that a consistent and healthy interest coverage ratio above 1 is generally preferred by investors and creditors as it signifies that the company is generating enough operating income to cover its interest expenses. In the case of Century Aluminum Company, the fluctuating interest coverage ratios may indicate varying levels of financial risk and operational performance over the periods analyzed. Further analysis and monitoring of the company's financial performance and debt management are advisable to assess its overall financial health and stability.