Sotera Health Co (SHC)
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 | 7.59 | 7.05 | 8.90 | 4.76 | 6.07 |
Sotera Health Co demonstrates strong solvency based on its solvency ratios. The Debt-to-assets ratio, Debt-to-capital ratio, and Debt-to-equity ratio have consistently been at 0.00 from December 31, 2020, to December 31, 2024. This indicates that the company has no debt obligations in relation to its total assets, capital, or equity during this period.
The Financial leverage ratio, on the other hand, shows some variation but overall remains at manageable levels. The ratio decreased from 6.07 in 2020 to 4.76 in 2021, indicating lower financial leverage. However, it increased in subsequent years, reaching 8.90 in 2022, 7.05 in 2023, and 7.59 in 2024. Despite these fluctuations, the ratios are within reasonable limits, signaling that Sotera Health Co has been able to effectively manage its financial leverage and maintain a healthy balance between debt and equity in its capital structure.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 1.69 | 1.82 | -1.88 | 3.38 | 0.81 |
Sotera Health Co's interest coverage ratio provides insight into the company's ability to meet its interest obligations with its earnings before interest and taxes (EBIT). From the data provided, we observe fluctuations in the interest coverage ratio over the years:
- As of December 31, 2020, the interest coverage ratio was 0.81, indicating that the company's EBIT was only sufficient to cover 81% of its interest expenses. This suggests a potential risk in meeting interest payments.
- By December 31, 2021, the interest coverage ratio improved significantly to 3.38, reflecting a stronger ability to cover interest expenses with operating earnings.
- However, the ratio turned negative on December 31, 2022, with a value of -1.88. This signifies that the company's EBIT was insufficient to cover its interest obligations, raising concerns about its financial health and ability to service debt.
- Over the following years, the interest coverage ratios improved slightly to 1.82 on December 31, 2023, and 1.69 on December 31, 2024. Although the ratios were still below ideal levels of coverage, they showed some recovery compared to the negative ratio in 2022.
Overall, the fluctuating trend in Sotera Health Co's interest coverage ratios indicates variations in its ability to meet interest payments with its operating profits. Investors and creditors should closely monitor these ratios to assess the company's financial stability and debt repayment capacity.