Otter Tail Corporation (OTTR)

Solvency ratios

	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	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Debt-to-assets ratio	0.25	0.26	0.27	0.28	0.28	0.28	0.29	0.26	0.27	0.22	0.23	0.24	0.24	0.30	0.30	0.31	0.30	0.27	0.28	0.28
Debt-to-capital ratio	0.36	0.37	0.38	0.39	0.40	0.41	0.42	0.41	0.43	0.38	0.41	0.41	0.42	0.47	0.47	0.48	0.47	0.44	0.44	0.44
Debt-to-equity ratio	0.57	0.59	0.62	0.65	0.68	0.70	0.74	0.70	0.74	0.62	0.68	0.70	0.72	0.90	0.88	0.91	0.88	0.78	0.79	0.80
Financial leverage ratio	2.25	2.27	2.33	2.36	2.38	2.45	2.58	2.67	2.78	2.85	2.92	2.95	2.96	2.97	2.91	2.88	2.91	2.88	2.84	2.84

Solvency ratios provide important insights into a company's ability to meet its long-term financial obligations. Looking at Otter Tail Corporation's solvency ratios over the past eight quarters, we can observe the following trends:

1. Debt-to-assets ratio: This ratio measures the proportion of a company's assets that are financed by debt. Otter Tail Corporation's debt-to-assets ratio has remained relatively stable around 0.28 to 0.30, indicating that roughly 28% to 30% of the company's assets are funded by debt.

2. Debt-to-capital ratio: The debt-to-capital ratio reflects the percentage of a company's capital that is contributed by debt. Over the past quarters, Otter Tail Corporation's debt-to-capital ratio has ranged from 0.38 to 0.45, showing that debt accounts for approximately 38% to 45% of the company's total capital.

3. Debt-to-equity ratio: This ratio compares a company's total debt to its total equity, providing insight into the level of risk associated with the company's capital structure. Otter Tail Corporation's debt-to-equity ratio has fluctuated between 0.62 and 0.82, indicating that the company has taken on varying levels of debt relative to its equity.

4. Financial leverage ratio: The financial leverage ratio measures a company's total assets relative to its equity, showing the extent to which the company relies on debt to finance its operations. Otter Tail Corporation's financial leverage ratio has ranged from 2.25 to 2.67, indicating that the company's assets are leveraged between 2.25 to 2.67 times its equity.

Overall, Otter Tail Corporation's solvency ratios suggest that the company has maintained a relatively stable capital structure with a moderate level of debt in its financial structure. It is important for the company to monitor these ratios and ensure they remain within reasonable levels to maintain financial stability and meet its long-term obligations effectively.

Coverage ratios

	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	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Interest coverage	10.03	9.78	9.62	10.22	10.84	11.18	9.93	8.14	6.61	5.48	5.04	4.28	4.29	4.50	4.17	4.24	4.29	4.10	4.13	4.26

Otter Tail Corporation's interest coverage ratio has shown a relatively stable trend over the past eight quarters, ranging from 8.14 to 11.18. The interest coverage ratio measures the company's ability to meet its interest obligations from its operating income, with a higher ratio indicating a stronger ability to cover interest expenses.

In the most recent quarter, Q4 2023, the interest coverage ratio was 10.03, which means that the company generated operating income 10.03 times higher than its interest expenses, indicating a healthy cushion to meet its interest payments. Although slightly lower than the ratio in the previous quarter, Q3 2023, it remains above 9.0, reflecting a strong ability to service its debt.

Looking further back, the interest coverage ratio peaked in Q4 2022 at 11.18 and has fluctuated within a relatively narrow range since then. This stability suggests that Otter Tail Corporation has been effectively managing its interest expenses relative to its operating income.

Overall, based on the historical data provided, Otter Tail Corporation maintains a solid interest coverage ratio, indicating a consistent ability to meet its interest obligations and suggesting a healthy financial position in terms of debt servicing.