LyondellBasell Industries NV (LYB)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 2.87 | 2.86 | 2.88 | 3.10 | 4.44 |
Based on the provided data, LyondellBasell Industries NV exhibits strong solvency ratios, indicating a healthy financial position in terms of its ability to meet its long-term obligations.
1. Debt-to-assets ratio: The debt-to-assets ratio for LyondellBasell Industries NV is consistently at 0.00 for the years 2020 to 2024. This implies that the company has no debt relative to its total assets, which is a positive indicator of financial stability and lower risk of default.
2. Debt-to-capital ratio: Similarly, the debt-to-capital ratio remains constant at 0.00 across the same period. This suggests that the company's capital structure is not significantly reliant on debt financing, which can reduce financial risk and improve overall financial health.
3. Debt-to-equity ratio: The debt-to-equity ratio also stands at 0.00 for the years 2020 to 2024. This indicates that LyondellBasell Industries NV has no debt in relation to its equity, reflecting a conservative approach to leverage and financial risk management.
4. Financial leverage ratio: The financial leverage ratio shows a declining trend from 4.44 in 2020 to 2.87 in 2024. This indicates that the company's reliance on debt to finance its operations has been decreasing over the years, which can enhance financial flexibility and reduce the potential impact of interest rate fluctuations.
In summary, LyondellBasell Industries NV's solvency ratios demonstrate a strong financial position with minimal debt levels relative to assets, capital, and equity. The decreasing trend in the financial leverage ratio further signifies the company's prudent management of debt and risk, positioning it well to weather economic uncertainties and capitalize on growth opportunities.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 4.33 | 6.51 | 16.85 | 14.54 | 4.24 |
The interest coverage ratio of LyondellBasell Industries NV has shown fluctuations over the past five years based on the provided data.
As of December 31, 2020, the interest coverage ratio was 4.24, indicating that the company generated operating income 4.24 times greater than its interest expenses for that period. This suggests a moderate ability to service its interest obligations.
The ratio significantly improved to 14.54 by the end of December 31, 2021, and further increased to 16.85 by the end of December 31, 2022. These substantial improvements indicate that the company's operating income was more than sufficient to cover its interest expenses during these years, reflecting a strong ability to meet its interest payments.
However, there was a notable decline in the interest coverage ratio to 6.51 by December 31, 2023, and further down to 4.33 by December 31, 2024. These decreases suggest that the company's operating income was less able to cover its interest expenses during these periods, raising concerns about its ability to comfortably meet its interest obligations.
In conclusion, LyondellBasell Industries NV's interest coverage ratio has demonstrated variability in recent years, with significant improvements followed by declines. It is essential for investors and creditors to monitor this ratio closely to assess the company's ability to manage its interest costs effectively.