Trane Technologies plc (TT)
Solvency ratios
| 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 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.21 | 0.21 | 0.21 | 0.21 | 0.21 | 0.24 | 0.24 | 0.25 | 0.21 | 0.21 | 0.21 | 0.25 | 0.25 | 0.25 | 0.24 | 0.25 | 0.25 | 0.25 | 0.27 | 0.26 |
| Debt-to-capital ratio | 0.37 | 0.36 | 0.38 | 0.37 | 0.36 | 0.40 | 0.42 | 0.43 | 0.38 | 0.39 | 0.40 | 0.43 | 0.42 | 0.41 | 0.41 | 0.42 | 0.41 | 0.41 | 0.44 | 0.44 |
| Debt-to-equity ratio | 0.58 | 0.57 | 0.62 | 0.58 | 0.57 | 0.67 | 0.72 | 0.74 | 0.62 | 0.65 | 0.66 | 0.75 | 0.72 | 0.69 | 0.70 | 0.71 | 0.70 | 0.71 | 0.78 | 0.80 |
| Financial leverage ratio | 2.70 | 2.75 | 2.91 | 2.81 | 2.77 | 2.83 | 3.02 | 2.97 | 2.97 | 3.03 | 3.09 | 2.94 | 2.89 | 2.81 | 2.84 | 2.83 | 2.83 | 2.82 | 2.90 | 3.06 |
Trane Technologies plc has shown a consistent improvement in its solvency ratios over the years. The debt-to-assets ratio has declined steadily from 0.27 in June 2020 to 0.21 in June 2024, indicating a lower reliance on debt to finance its assets.
Similarly, the debt-to-capital ratio has decreased from 0.44 in June 2020 to 0.38 in December 2023 before slightly increasing to 0.37 in June 2024. This trend suggests the company is effectively managing its capital structure by reducing its debt relative to its total capital.
Moreover, the debt-to-equity ratio has shown a significant decline from 0.78 in June 2020 to 0.58 in December 2024. This indicates that the company has been steadily reducing its debt in relation to its equity, improving its financial leverage and risk profile.
The financial leverage ratio, which gives an overall view of the company's financial risk, has also displayed a decreasing trend, starting at 2.90 in June 2020 and reaching 2.70 in December 2024. This reflects the company's ability to meet its financial obligations through a conservative level of debt compared to its equity.
In conclusion, Trane Technologies plc has demonstrated strong progress in improving its solvency position over the analyzed period, showcasing prudent financial management and a healthier balance sheet structure.
Coverage ratios
| 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 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 14.40 | 13.96 | 13.51 | 12.42 | 11.76 | 11.44 | 10.97 | 10.73 | 10.54 | 9.95 | 9.21 | 8.84 | 8.52 | 8.06 | 7.87 | 6.74 | 5.63 | 5.70 | 5.87 | 6.69 |
Trane Technologies plc has shown a consistent improvement in its interest coverage ratio over the reported periods, which indicates the company's ability to meet its interest obligations from its operating income. The interest coverage ratio has been increasing steadily from 6.69 in March 2020 to 14.40 in December 2024. This upward trend suggests that the company's earnings are sufficient to cover its interest expenses, signifying a lower risk of default on its debt obligations. Overall, the increasing interest coverage ratio reflects improved financial health and stability for Trane Technologies plc.