Sempra Energy (SRE)
Solvency ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.31 | 0.28 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.47 | 0.44 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.90 | 0.77 | 0.00 | 0.00 |
| Financial leverage ratio | 3.04 | 2.90 | 2.77 | 2.85 | 3.29 |
The solvency ratios of Sempra over the past five years show a mixed trend.
The debt-to-assets ratio has fluctuated slightly between 0.34 and 0.39, indicating that, on average, 34-39% of Sempra's assets are financed by debt. This suggests that the company has been managing its debt levels relative to its asset base relatively consistently.
The debt-to-capital ratio has also shown some stability, ranging from 0.49 to 0.56, signifying that, on average, debt constitutes around 49-56% of Sempra's capital structure. This indicates a balanced mix of debt and equity in financing the company's operations.
The debt-to-equity ratio has displayed a declining trend from 1.30 in 2019 to 1.08 in 2023. This indicates that the company's reliance on debt financing in relation to equity has decreased over the years, which can be seen as a positive sign for long-term financial stability.
The financial leverage ratio, which measures the company's total debt relative to its equity, has ranged from 2.77 to 3.29. This indicates that, on average, Sempra carries 2.77-3.29 times more debt than equity on its balance sheet, highlighting moderate financial leverage.
Overall, Sempra's solvency ratios suggest a relatively conservative approach to debt management, with a balanced capital structure and decreasing reliance on debt financing over the past five years.
Coverage ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Interest coverage | 3.72 | 3.56 | 2.18 | 4.71 | 3.20 |
The interest coverage ratio for Sempra has shown a generally positive trend over the past five years, indicating the company's improving ability to cover its interest expenses from its operating income. The ratio has increased from 3.24 in 2019 to 4.26 in 2023, demonstrating a consistent upward trajectory. This suggests that Sempra has been generating sufficient operating income to comfortably meet its interest payment obligations, affirming its financial stability and ability to service its debt. Overall, the trend in the interest coverage ratio reflects favorably on Sempra's financial health and its capacity to manage debt effectively.