Enerpac Tool Group Corp (EPAC)

Solvency ratios

Aug 31, 2024 May 31, 2024 Feb 29, 2024 Nov 30, 2023 Aug 31, 2023 May 31, 2023 Feb 28, 2023 Nov 30, 2022 Aug 31, 2022 May 31, 2022 Feb 28, 2022 Nov 30, 2021 Aug 31, 2021 May 31, 2021 Feb 28, 2021 Nov 30, 2020 Aug 31, 2020 May 31, 2020 Feb 29, 2020 Nov 30, 2019
Debt-to-assets ratio 0.24 0.25 0.31 0.31 0.28 0.29 0.27 0.26 0.26 0.26 0.21 0.22 0.21 0.23 0.26 0.30 0.31 0.34 0.33 0.32
Debt-to-capital ratio 0.33 0.34 0.42 0.43 0.39 0.41 0.38 0.37 0.39 0.36 0.30 0.30 0.30 0.32 0.36 0.41 0.42 0.46 0.45 0.45
Debt-to-equity ratio 0.48 0.52 0.71 0.75 0.64 0.69 0.61 0.60 0.63 0.56 0.42 0.43 0.42 0.47 0.55 0.69 0.71 0.85 0.81 0.81
Financial leverage ratio 1.98 2.05 2.28 2.38 2.33 2.36 2.27 2.32 2.38 2.18 1.99 1.98 1.99 2.02 2.12 2.28 2.29 2.53 2.48 2.57

The solvency ratios of Enerpac Tool Group Corp indicate the company's ability to meet its long-term financial obligations and the extent to which it relies on debt to fund its operations.

1. Debt-to-assets ratio: This ratio has shown relatively stable levels ranging from 0.21 to 0.34 over the period under review. The company has maintained a moderate level of debt relative to its total assets, signifying a lower financial risk and a solid asset base that can support its debt obligations.

2. Debt-to-capital ratio: The trend in this ratio has fluctuated between 0.30 and 0.46, indicating that the company has been managing its debt and capital structure somewhat effectively. The increase in the ratio over time suggests a growing reliance on debt to finance growth or operations, indicating higher financial leverage.

3. Debt-to-equity ratio: Enerpac Tool Group Corp's debt-to-equity ratio has shown variability, ranging from 0.42 to 0.85. This implies that the company has been financing a portion of its operations through debt, leading to increased financial leverage. The higher ratios in recent periods indicate a greater proportion of debt relative to equity, reflecting potentially higher financial risk.

4. Financial leverage ratio: The financial leverage ratio has also displayed fluctuations, indicating changes in the company's capital structure. The ratio has ranged from 1.98 to 2.57, reflecting the company's use of debt to finance its operations. Higher ratios suggest increased financial risk due to higher levels of debt relative to equity.

In conclusion, while Enerpac Tool Group Corp has maintained moderate levels of debt relative to assets, its increasing debt-to-capital, debt-to-equity, and financial leverage ratios over time indicate a growing reliance on debt financing and potentially higher financial risk. It will be essential for the company to carefully manage its debt levels to ensure sustainable long-term financial health.

Coverage ratios

Aug 31, 2024 May 31, 2024 Feb 29, 2024 Nov 30, 2023 Aug 31, 2023 May 31, 2023 Feb 28, 2023 Nov 30, 2022 Aug 31, 2022 May 31, 2022 Feb 28, 2022 Nov 30, 2021 Aug 31, 2021 May 31, 2021 Feb 28, 2021 Nov 30, 2020 Aug 31, 2020 May 31, 2020 Feb 29, 2020 Nov 30, 2019
Interest coverage 8.99 8.83 8.35 7.56 6.77 5.96 5.36 5.86 6.99 8.80 12.03 10.75 9.71 5.29 1.47 1.33 1.26 1.17 2.64 2.54

The interest coverage ratio for Enerpac Tool Group Corp has shown fluctuations over the past few quarters. The ratio peaked at 12.03 in the first quarter of 2022, indicating a strong ability to cover interest expenses with operating income. However, the ratio has since declined, reaching a low of 1.26 in the first quarter of 2021, suggesting a potential strain on the company's ability to cover interest costs with its operating earnings.

It is important to note that a higher interest coverage ratio is generally preferred as it signifies a company's capacity to meet its interest obligations comfortably. A decreasing trend in the interest coverage ratio may raise concerns about Enerpac Tool Group Corp's financial health and its ability to service its debt obligations. Further analysis and monitoring of the company's financial performance and debt management practices may be warranted to assess the sustainability of its interest coverage levels.