Harmony Biosciences Holdings (HRMY)
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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.16 | 0.18 | 0.20 | 0.21 | 0.22 | 0.23 | 0.24 | 0.26 | 0.28 | 0.29 | 0.38 | 0.41 | 0.44 | 0.49 | 0.54 |
| Debt-to-capital ratio | 0.20 | 0.22 | 0.24 | 0.25 | 0.28 | 0.27 | 0.27 | 0.29 | 0.32 | 0.36 | 0.43 | 0.47 | 0.50 | 0.56 | 0.61 |
| Debt-to-equity ratio | 0.25 | 0.28 | 0.32 | 0.34 | 0.38 | 0.38 | 0.37 | 0.42 | 0.47 | 0.55 | 0.77 | 0.89 | 1.02 | 1.25 | 1.55 |
| Financial leverage ratio | 1.52 | 1.56 | 1.59 | 1.64 | 1.74 | 1.62 | 1.57 | 1.61 | 1.67 | 1.87 | 2.05 | 2.16 | 2.32 | 2.57 | 2.84 |
Based on the solvency ratios of Harmony Biosciences Holdings, the company has demonstrated a consistent improvement in its solvency position over the analyzed periods.
1. Debt-to-assets ratio: The debt-to-assets ratio has been declining steadily from 0.54 in June 2021 to 0.16 in December 2024. This indicates that the company's total debt relative to its total assets has decreased, reflecting a stronger financial position.
2. Debt-to-capital ratio: Similarly, the debt-to-capital ratio has shown a decreasing trend from 0.61 in June 2021 to 0.20 in December 2024. This suggests that the company has been reducing its reliance on debt financing in relation to its total capital, contributing to improved solvency.
3. Debt-to-equity ratio: The debt-to-equity ratio has also decreased consistently from 1.55 in June 2021 to 0.25 in December 2024. This signifies a lower level of debt in relation to equity, indicating better financial stability and less financial risk for the company.
4. Financial leverage ratio: The financial leverage ratio has shown a declining trend, from 2.84 in June 2021 to 1.52 in December 2024. A lower financial leverage ratio indicates that the company is relying less on debt to finance its operations, which is a positive indicator of financial health and stability.
Overall, the downward trajectory of these solvency ratios reflects Harmony Biosciences Holdings' ability to manage its debt levels effectively and strengthen its financial position over the analyzed period. This improvement may enhance the company's ability to weather economic downturns and pursue future growth opportunities.
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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 11.15 | 9.93 | 8.79 | 9.22 | 8.08 | 8.17 | 6.58 | 6.56 | 6.39 | 5.75 | 6.08 | 4.73 | 4.95 | 4.50 | 3.43 |
Harmony Biosciences Holdings' interest coverage ratio has shown a positive trend over the reported periods from June 30, 2021, to December 31, 2024. The interest coverage ratio measures the company's ability to cover its interest expenses with its operating income.
Starting at 3.43 on June 30, 2021, the interest coverage ratio improved steadily, reaching its peak of 11.15 on December 31, 2024. This indicates the company had significantly more operating income relative to its interest expense by the end of the reporting period.
The increasing trend in the interest coverage ratio suggests that Harmony Biosciences Holdings had a healthy ability to meet its interest obligations from its operating earnings. A higher interest coverage ratio is generally considered favorable as it signifies that the company is at a lower risk of defaulting on its debt.
The company's interest coverage ratio reaching above 8 in the latter periods shows a strong financial position, indicating that Harmony Biosciences Holdings has sufficient earnings to comfortably cover its interest payments. This trend portrays a positive picture of the company's financial stability and ability to handle its debt-related commitments effectively.