Ecolab Inc (ECL)
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 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.37 | 0.00 | 0.00 | 0.00 | 0.30 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.52 | 0.00 | 0.00 | 0.00 | 0.42 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 1.08 | 0.00 | 0.00 | 0.00 | 0.72 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 2.72 | 2.80 | 2.84 | 2.89 | 2.97 | 2.98 | 2.98 | 2.97 | 2.94 | 2.59 | 2.76 | 2.89 | 2.94 | 3.01 | 3.09 | 2.53 | 2.40 | 2.43 | 2.53 | 2.55 |
Ecolab, Inc.'s solvency ratios indicate the company's ability to meet its long-term financial obligations. The debt-to-assets ratio has been relatively stable over recent quarters, ranging from 0.37 to 0.42. This ratio suggests that around 37% to 42% of the company's assets are financed by debt, with a decreasing trend observed.
The debt-to-capital and debt-to-equity ratios also show a similar trend, increasing slightly quarter by quarter. The debt-to-capital ratio fluctuated between 0.50 and 0.55, while the debt-to-equity ratio ranged from 1.02 to 1.24. These ratios indicate that over 50% of Ecolab's capital is funded by debt, and the company's shareholders carry a debt burden equivalent to between 102% to 124% of their equity stake.
The financial leverage ratio, reflecting the proportion of the company's assets supported by debt, shows an upward trend from 2.72 to 2.97 over the observed periods. This indicates that the company's reliance on debt to finance its operations has been increasing steadily.
Overall, Ecolab's solvency ratios demonstrate a moderate increase in leverage and debt financing over the quarters, raising the company's financial risk profile. However, the ratios remain within manageable levels for now, but continuous monitoring of the trend is advisable to ensure the company's long-term financial health.
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 | 5.97 | 5.67 | 5.75 | 6.07 | 6.30 | 6.98 | 6.65 | 6.84 | 7.05 | 7.04 | 5.37 | 4.36 | 4.58 | 4.92 | 7.49 | 9.05 | 8.60 | 8.70 | 8.34 | 8.27 |
Based on the data provided, Ecolab, Inc.'s interest coverage ratio has been consistently above 6 in the past eight quarters, indicating the company's ability to meet its interest obligations with relative ease. The interest coverage ratio measures the company's ability to pay interest on its outstanding debt with its operating income.
The relatively stable interest coverage ratio above 6 signifies that Ecolab's operating income is substantial enough to cover its interest expenses comfortably. This consistency over the quarters suggests a solid financial position and stability in managing its debt obligations.
Investors and creditors typically consider a higher interest coverage ratio to be favorable, as it indicates lower default risk and a stronger financial position. Ecolab's consistent interest coverage ratio above 6 reflects positively on its financial health and ability to manage its debt effectively.