Enpro Industries (NPO)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.26 | 0.29 | 0.32 | 0.23 | 0.31 |
| Debt-to-capital ratio | 0.31 | 0.36 | 0.43 | 0.31 | 0.41 |
| Debt-to-equity ratio | 0.45 | 0.56 | 0.76 | 0.45 | 0.70 |
| Financial leverage ratio | 1.77 | 1.90 | 2.34 | 1.93 | 2.27 |
Over the past five years, Enpro Inc's solvency ratios have shown fluctuations, indicating varying levels of financial leverage and risk.
1. Debt-to-assets ratio: This ratio measures the proportion of the company's assets that are financed by debt. Enpro Inc's debt-to-assets ratio has decreased from 0.31 in 2019 to 0.26 in 2023, indicating a reduction in reliance on debt to finance its assets. A lower ratio implies that the company has a stronger ability to cover its obligations with its assets.
2. Debt-to-capital ratio: This ratio assesses the extent to which a company is funded by debt relative to its total capital (debt + equity). Enpro Inc's debt-to-capital ratio has fluctuated over the years, with a decrease from 0.42 in 2019 to 0.31 in 2023. This reduction suggests a more conservative capital structure and lower risk associated with debt.
3. Debt-to-equity ratio: The debt-to-equity ratio indicates the proportion of a company's financing that comes from debt versus equity. Enpro Inc's debt-to-equity ratio has shown significant variations, ranging from 0.46 in 2023 to a high of 0.89 in 2021. The decrease in this ratio reflects a declining reliance on debt financing and a more balanced mix of debt and equity in the capital structure.
4. Financial leverage ratio: This ratio compares a company's total assets to its equity and measures the extent to which the company is leveraged with debt. Enpro Inc's financial leverage ratio has fluctuated, with a decrease from 2.29 in 2019 to 1.77 in 2023. A lower financial leverage ratio indicates reduced financial risk and potential for increased financial stability.
Overall, Enpro Inc's solvency ratios reflect a trend of decreasing reliance on debt financing and a more conservative approach to capital structure management. This suggests improved financial stability and lower risk of default, which can enhance the company's long-term sustainability and ability to meet its financial obligations.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 2.18 | 7.45 | 12.52 | 11.61 | 2.78 |
The interest coverage ratio measures a company's ability to meet its interest payments on its debt obligations with its operating income. A higher interest coverage ratio indicates that the company is more capable of servicing its debt.
Looking at Enpro Inc's interest coverage ratio over the past five years, we observe fluctuations in the company's ability to cover its interest expenses. In 2023, the interest coverage ratio improved to 4.57 from 4.05 in the previous year, indicating that Enpro Inc generated 4.57 times the amount of operating income needed to cover its interest payments for the year.
Comparing this to the ratio of 6.88 in 2021, we see a significant decrease in the company's ability to cover interest expenses. However, the ratio remains above 1, suggesting that Enpro Inc was still able to meet its interest obligations in 2023. The trend over the past five years reveals some variability in the company's ability to service its debt, with fluctuations in the ratio reflecting changes in operating income relative to interest expenses. Further analysis of the company's financial performance and debt management practices would provide a more comprehensive understanding of its financial health.