Graphic Packaging Holding Company (GPK)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.41 | 0.50 | 0.53 | 0.40 | 0.39 |
| Debt-to-capital ratio | 0.62 | 0.71 | 0.74 | 0.69 | 0.64 |
| Debt-to-equity ratio | 1.66 | 2.42 | 2.92 | 2.21 | 1.79 |
| Financial leverage ratio | 4.02 | 4.81 | 5.53 | 5.48 | 4.64 |
The solvency ratios of Graphic Packaging Holding Co indicate its ability to meet its long-term financial obligations. Over the past five years, the company has generally maintained a decreasing trend in the debt-to-assets ratio, suggesting efficient asset management and decreasing reliance on debt to fund its operations.
The debt-to-capital ratio has also shown a slightly decreasing trend, indicating that the company has been reducing its dependence on debt to finance its operations, which is a positive sign for investors and creditors.
However, the debt-to-equity ratio has fluctuated over the years, with a significant increase in 2021. This ratio indicates the proportion of the company's assets that are financed by debt compared to equity. The higher the ratio, the greater the financial leverage and associated financial risk. Graphic Packaging Holding Co's decreasing trend in the debt-to-equity ratio from 2021 to 2023 is a positive sign, showing a move towards a more balanced capital structure.
The financial leverage ratio has also decreased over the years, showing that the company has been reducing its reliance on debt to fund its operations. A decreasing trend in this ratio indicates a lower risk of insolvency and financial distress for the company.
Overall, based on the solvency ratios of Graphic Packaging Holding Co, it appears that the company has been effectively managing its capital structure and financial leverage, which is a positive indicator of its solvency and financial stability.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 4.90 | 4.63 | 3.26 | 2.62 | 3.01 |
The interest coverage ratio for Graphic Packaging Holding Co has shown a generally positive trend over the past five years. The company's ability to cover its interest expenses has been improving, with the ratio increasing from 4.07 in 2019 to 5.49 in 2023. This indicates that the company is generating sufficient operating income to cover its interest payments comfortably. A ratio above 1 suggests that the company is able to meet its interest obligations, and higher values like those seen in the recent years indicate a stronger ability to do so. Overall, the increasing trend in the interest coverage ratio reflects a positive financial position for Graphic Packaging Holding Co in terms of its ability to manage its debt servicing obligations.