STERIS plc (STE)
Solvency ratios
| Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 1.53 | 1.56 | 1.55 | 1.59 | 1.76 | 1.78 | 1.82 | 1.75 | 1.78 | 1.79 | 1.81 | 1.74 | 1.75 | 1.76 | 1.80 | 1.84 | 1.69 | 1.70 | 1.50 | 1.54 |
Based on the provided data for STERIS plc, it is evident that the company maintains a strong solvency position with consistently low debt-related ratios across the years.
1. Debt-to-assets ratio: The ratio reflects the proportion of the company's assets financed by debt. STERIS plc's debt-to-assets ratio has consistently been at 0.00, indicating that the company's assets are primarily financed through equity rather than debt. This suggests a low risk of insolvency or financial distress due to excessive debt.
2. Debt-to-capital ratio: This ratio illustrates the extent of the company's capital structure that is funded by debt. Similarly, STERIS plc's debt-to-capital ratio has remained at 0.00 throughout the period, highlighting a conservative approach to leveraging and maintaining a healthy balance between debt and equity in its capital structure.
3. Debt-to-equity ratio: The debt-to-equity ratio signifies the proportion of the company's capital that is debt-financed versus equity-financed. Once again, STERIS plc's consistent 0.00 debt-to-equity ratio reflects a capital structure skewed towards equity, indicating a low financial risk and a strong balance sheet position.
4. Financial leverage ratio: This ratio measures the company's financial risk by evaluating how much debt is used to finance its assets relative to equity. STERIS plc's financial leverage ratio ranged from 1.50 to 1.84 during the analyzed period, with the value fluctuating slightly but generally maintained at moderate levels. The decreasing trend towards the end of the period suggests a reduction in financial leverage and, subsequently, lower financial risk.
In conclusion, STERIS plc's solvency ratios demonstrate a prudent and conservative financial strategy, with minimal reliance on debt financing and a healthy balance between debt and equity in its capital structure. These ratios indicate a robust solvency position, with a low risk of default or financial instability in the foreseeable future.
Coverage ratios
| Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 7.74 | 8.89 | 7.27 | 6.30 | 6.17 | 6.14 | 6.39 | 2.62 | 2.46 | 1.35 | 1.60 | 6.26 | 4.52 | 6.09 | 4.74 | 6.80 | 12.59 | 12.80 | 15.42 | 14.20 |
The interest coverage ratio for STERIS plc has exhibited fluctuations over the period from June 30, 2020, to March 31, 2025. The interest coverage ratio represents the company's ability to meet its interest obligations from its earnings before interest and taxes (EBIT). A higher interest coverage ratio indicates a stronger ability to cover interest expenses.
The trend analysis reveals that the interest coverage ratio was relatively strong in the earlier periods, standing at 14.20 on June 30, 2020, and steadily increasing to 15.42 on September 30, 2020. However, the ratio began to decline from December 31, 2020, reaching a low of 1.60 on September 30, 2022. This significant drop in the interest coverage ratio may raise concerns about STERIS plc's ability to meet its interest payments comfortably from its operating income.
Subsequently, there was a slight improvement in the ratio, with values ranging from 2.46 on March 31, 2022, to 8.89 on December 31, 2024. The latest reported interest coverage ratio as of March 31, 2025, is 7.74, indicating a moderate ability to cover interest expenses.
Overall, the fluctuating trend in STERIS plc's interest coverage ratio suggests varying levels of financial leverage and the company's ability to manage its interest payments. It is important for stakeholders to monitor this ratio closely to assess the company's financial health and debt-servicing capacity.