O-I Glass Inc (OI)

The solvency ratios of O-I Glass Inc indicate the company's ability to meet its long-term financial obligations and manage its debt levels over time.

1. Debt-to-assets ratio: This ratio shows the proportion of the company's assets financed by debt. O-I Glass Inc's debt-to-assets ratio has gradually decreased from 0.56 in 2020 to 0.53 in 2024. This suggests that the company has been effectively managing its debt levels in relation to its total assets.

2. Debt-to-capital ratio: The debt-to-capital ratio measures the portion of the company's capital structure that is funded by debt. O-I Glass Inc's debt-to-capital ratio has shown a decreasing trend from 0.94 in 2020 to 0.81 in 2024. This indicates a decreasing reliance on debt financing relative to the company's total capital.

3. Debt-to-equity ratio: The debt-to-equity ratio reflects the company's financial leverage and shows how much debt the company is using to finance its operations compared to equity. O-I Glass Inc's debt-to-equity ratio has declined significantly from 16.65 in 2020 to 4.22 in 2024, indicating a substantial decrease in debt relative to equity over the years.

4. Financial leverage ratio: The financial leverage ratio measures the company's ability to meet its financial obligations through its available assets. O-I Glass Inc's financial leverage ratio has decreased from 29.91 in 2020 to 8.02 in 2024, suggesting an improvement in the company's ability to cover its financial commitments.

Overall, the solvency ratios of O-I Glass Inc demonstrate a trend of decreasing debt levels and improving financial leverage, indicating a stronger financial position and better ability to manage its long-term debt obligations.

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Coverage ratios

The interest coverage ratio for O-I Glass Inc has shown some fluctuation over the past five years. The ratio was 2.28 at the end of December 31, 2020, indicating that the company's operating income was able to cover its interest expenses 2.28 times.

By the end of December 31, 2021, the interest coverage ratio improved slightly to 2.46, suggesting a slight increase in the company's ability to cover its interest obligations. This positive trend continued into December 31, 2022, with a notable increase in the interest coverage ratio to 4.19, indicating a significant improvement in the company's ability to meet its interest payments.

However, there was a significant drop in the interest coverage ratio by the end of December 31, 2023, where it fell to 1.14. This decrease may indicate a potential strain on the company's ability to cover its interest expenses effectively.

Further, by the end of December 31, 2024, the interest coverage ratio declined further to 1.06, which is a concerning sign as it suggests that the company's operating income may not be sufficient to meet its interest obligations adequately.

Overall, while there have been periods of both improvement and decline in O-I Glass Inc's interest coverage ratio over the past five years, the decreasing trend in recent years may raise concerns about the company's financial health and its ability to manage its debt effectively.