KBR Inc (KBR)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.32 | 0.25 | 0.30 | 0.28 | 0.22 |
| Debt-to-capital ratio | 0.57 | 0.46 | 0.53 | 0.50 | 0.39 |
| Debt-to-equity ratio | 1.30 | 0.85 | 1.12 | 1.00 | 0.64 |
| Financial leverage ratio | 4.02 | 3.44 | 3.72 | 3.61 | 2.91 |
Based on the solvency ratios of KBR Inc over the past five years, we can observe the following trends:
1. Debt-to-assets ratio: This ratio measures the proportion of the company's assets financed by debt. KBR Inc has seen fluctuations in this ratio, ranging from 0.22 in 2019 to 0.32 in 2023. An increasing trend indicates a higher reliance on debt to finance assets.
2. Debt-to-capital ratio: This ratio shows the percentage of the company's capital structure that is funded by debt. KBR Inc's debt-to-capital ratio has increased over the years, reaching 0.57 in 2023. This suggests a growing dependence on debt as a source of capital.
3. Debt-to-equity ratio: This ratio compares the company's total debt to its shareholders' equity. KBR Inc's debt-to-equity ratio has been fluctuating, with a notable increase from 0.64 in 2019 to 1.30 in 2023. A higher debt-to-equity ratio indicates higher financial leverage and potential risk.
4. Financial leverage ratio: This ratio measures the company's total assets in relation to its equity. KBR Inc's financial leverage ratio has shown an upward trend, increasing from 2.91 in 2019 to 4.02 in 2023. This indicates a higher level of financial risk and potential volatility in earnings.
Overall, the solvency ratios of KBR Inc suggest a trend towards higher leverage and increased reliance on debt financing. It is important for investors and stakeholders to closely monitor these ratios to assess the company's ability to meet its financial obligations and manage its debt levels effectively.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | -0.48 | 4.24 | 2.72 | 0.51 | 3.64 |
The interest coverage ratio for KBR Inc has fluctuated over the past five years. In 2023, the interest coverage ratio was negative at -0.48, indicating that the company's earnings before interest and taxes (EBIT) were insufficient to cover its interest expenses. This is a concerning sign as it suggests financial distress.
In 2022 and 2021, the company's interest coverage improved to 4.24 and 2.72 respectively, showing a stronger ability to meet its interest obligations with its earnings. However, in 2020, the interest coverage ratio dropped significantly to 0.51, indicating a potential liquidity risk.
The highest interest coverage ratio was observed in 2019 at 3.64, reflecting a relatively healthy financial position in that year.
Overall, KBR Inc's interest coverage has been unstable, with fluctuations indicating varying levels of financial stability and risk. This trend may raise concerns about the company's ability to consistently generate enough earnings to cover its interest expenses.