Gates Industrial Corporation plc (GTES)

Solvency ratios

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Debt-to-assets ratio 0.34 0.33 0.33 0.33 0.33 0.34 0.35 0.33 0.34 0.35 0.35 0.35 0.34 0.34 0.34 0.36 0.36 0.40 0.41 0.40
Debt-to-capital ratio 0.43 0.43 0.42 0.42 0.43 0.44 0.45 0.43 0.44 0.46 0.46 0.46 0.45 0.46 0.46 0.48 0.49 0.53 0.54 0.54
Debt-to-equity ratio 0.76 0.75 0.73 0.73 0.75 0.78 0.82 0.75 0.78 0.84 0.86 0.86 0.82 0.84 0.86 0.92 0.95 1.13 1.16 1.17
Financial leverage ratio 2.24 2.29 2.21 2.22 2.25 2.30 2.37 2.27 2.31 2.40 2.43 2.47 2.43 2.49 2.51 2.59 2.65 2.82 2.87 2.89

The solvency ratios of Gates Industrial Corporation plc over the period displayed indicate the company's ability to meet its long-term financial obligations:

1. Debt-to-assets ratio has remained relatively stable between 0.33 and 0.41 over the years, showing consistent management of debt in proportion to total assets.

2. Debt-to-capital ratio has shown a declining trend, decreasing from 0.54 in March 2020 to 0.42 by June 30, 2024, indicating a reduction in financial leverage and reliance on external funding.

3. Debt-to-equity ratio has exhibited a decreasing pattern from 1.17 in March 2020 to 0.76 by December 31, 2024, reflecting a stronger financial position in terms of equity financing compared to debt.

4. The financial leverage ratio has also shown a downward trend, decreasing from 2.89 in March 2020 to 2.24 by December 31, 2024, indicating a decreasing reliance on debt to support the company's operations.

Overall, the company's solvency ratios indicate a prudent management of debt levels and an improving financial structure, which may enhance its ability to weather economic uncertainties and meet its financial obligations in the long term.

Coverage ratios

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Interest coverage 3.41 3.25 3.19 2.84 2.60 2.66 2.62 2.68 2.69 2.45 2.64 2.96 3.36 3.19 2.70 1.83 1.39 1.29 1.39 1.89

The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher ratio indicates a stronger ability to meet interest obligations.

Based on the data provided for Gates Industrial Corporation plc, we observe fluctuations in the interest coverage ratio over the reporting periods. As of December 31, 2024, the interest coverage ratio stands at 3.41, showing an improving trend from the previous periods.

The company experienced a significant increase in its interest coverage ratio from September 2021 to September 2024, indicating a better capacity to cover interest payments with operating income during these periods.

However, the interest coverage ratio dipped in some quarters, such as September 2020 and June 2022, which could suggest potential strain on the company's ability to meet interest obligations with operating income during those specific periods.

Overall, an interest coverage ratio above 1 indicates that Gates Industrial Corporation plc is generating sufficient operating income to cover its interest expenses. The increasing trend in the ratio over the reporting periods is a positive sign, reflecting an enhanced ability to manage interest payments effectively. It is essential for investors and creditors to monitor this ratio to assess the company's financial health and risk of default.