California Water Service Group (CWT)

Solvency ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Debt-to-assets ratio 0.23 0.26 0.26 0.27 0.25 0.28 0.29 0.29 0.29 0.29 0.30 0.22 0.23 0.22 0.23 0.24 0.25 0.27 0.27 0.24
Debt-to-capital ratio 0.42 0.43 0.43 0.45 0.44 0.45 0.47 0.48 0.47 0.49 0.52 0.46 0.46 0.47 0.50 0.51 0.50 0.52 0.53 0.50
Debt-to-equity ratio 0.74 0.75 0.76 0.81 0.80 0.83 0.88 0.91 0.90 0.95 1.06 0.84 0.85 0.88 1.00 1.04 1.01 1.07 1.12 1.00
Financial leverage ratio 3.22 2.86 2.87 2.99 3.24 2.99 3.06 3.12 3.08 3.30 3.56 3.73 3.68 3.94 4.30 4.29 3.99 3.99 4.10 4.06

The solvency ratios of California Water Service Group show a consistent trend over the past eight quarters. The debt-to-assets ratio has remained relatively stable, ranging from 0.27 to 0.31, indicating that around 27% to 31% of the company's assets are financed by debt.

Similarly, the debt-to-capital ratio has also shown stability, hovering between 0.45 and 0.49. This ratio indicates that debt accounts for approximately 45% to 49% of the company's total capital structure over the period under review.

The debt-to-equity ratio has exhibited more variability, fluctuating between 0.83 and 0.95. This suggests that the proportion of debt to equity in the company's financing mix has varied, with higher levels of debt relative to equity in some quarters.

The financial leverage ratio, which measures the extent to which the company relies on debt financing, has fluctuated as well, ranging from 2.86 to 3.22. This indicates that the company's financial leverage has varied, with the level of debt relative to equity and assets changing over time.

Overall, the solvency ratios of California Water Service Group suggest a stable financial position with a manageable level of debt in its capital structure. While the debt-to-equity ratio shows some variability, the company's overall solvency appears to be well-maintained over the period analyzed.

Coverage ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Interest coverage 1.64 1.49 2.01 2.35 3.02 2.70 2.82 3.19 3.09 3.36 4.34 3.69 3.51 3.50 2.14 2.47 2.63 2.90 2.68 2.73

The interest coverage ratio of California Water Service Group has shown some fluctuations over the past eight quarters. The ratio measures the company's ability to meet its interest payments on outstanding debt. Generally, a higher interest coverage ratio indicates a company is more capable of servicing its debt obligations.

In Q4 2023, the interest coverage ratio was 1.92, which signifies that the company generated 1.92 times more earnings before interest and taxes (EBIT) than the interest expense incurred during that period. This represents a slight improvement from the previous quarter, where the ratio was 1.63. However, the current ratio is still lower than the ratios observed in Q4 2022 (3.36) and Q1 2022 (3.48), indicating a lower capacity to cover interest payments compared to those periods.

The trend of declining interest coverage ratios from Q4 2022 to Q3 2023 suggests a potential decrease in the company's ability to service its debt in the short term. Investors and creditors may view this trend as a sign of increased financial risk for the company, as lower interest coverage ratios could indicate a higher likelihood of default on debt obligations.

It would be advisable for California Water Service Group to closely monitor its interest coverage ratio and take measures to improve it, such as increasing profitability, reducing debt levels, or refinancing debt at lower interest rates to enhance its financial stability and attractiveness to investors.