ChampionX Corporation (CHX)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.17 | 0.18 | 0.18 | 0.20 | 0.26 |
| Debt-to-capital ratio | 0.24 | 0.26 | 0.27 | 0.28 | 0.36 |
| Debt-to-equity ratio | 0.32 | 0.35 | 0.37 | 0.39 | 0.56 |
| Financial leverage ratio | 1.88 | 1.93 | 2.00 | 2.00 | 2.14 |
ChampionX Corporation's solvency ratios have shown a positive trend over the past few years. The Debt-to-assets ratio has decreased from 0.26 in 2020 to 0.17 in 2024, indicating that the company's level of debt relative to its total assets has been improving.
Similarly, the Debt-to-capital ratio has also decreased from 0.36 in 2020 to 0.24 in 2024, suggesting that the proportion of debt in the company's capital structure has been declining.
Moreover, the Debt-to-equity ratio has shown a decreasing trend from 0.56 in 2020 to 0.32 in 2024, indicating a reduction in financial leverage and a lower level of debt relative to equity.
The Financial leverage ratio has also improved, decreasing from 2.14 in 2020 to 1.88 in 2024, demonstrating that the company's reliance on debt financing has been decreasing over the years.
Overall, ChampionX Corporation's solvency ratios reflect a strengthened financial position, with lower debt levels and improved debt management, which may indicate improved financial stability and lower financial risk for the company.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 8.93 | 170.09 | 281.88 | 298.54 | -1,347.02 |
The interest coverage ratio of ChampionX Corporation has shown significant fluctuations over the past five years. In December 2020, the interest coverage ratio was -1,347.02, indicating that the company's operating income was significantly insufficient to cover its interest expenses. However, there has been a notable improvement in the following years, with the ratio increasing to 298.54 as of December 31, 2021, and further to 281.88 by December 31, 2022.
Although the trend suggests a positive development, it is important to note that the interest coverage ratio decreased to 170.09 by December 31, 2023, indicating a potential decrease in the company's ability to cover its interest expenses with operating income. Furthermore, the ratio dropped significantly to 8.93 by December 31, 2024, raising concerns about the company's ability to meet its interest obligations.
Overall, ChampionX Corporation's interest coverage ratio has experienced notable fluctuations, signaling potential challenges in servicing its interest obligations. Further analysis of the company's financial position and operating performance is warranted to assess the sustainability of its financial structure.