Westlake Chemical Corporation (WLK)
Solvency ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.22 | 0.22 | 0.24 | 0.27 | 0.26 |
| Debt-to-capital ratio | 0.30 | 0.31 | 0.33 | 0.38 | 0.37 |
| Debt-to-equity ratio | 0.43 | 0.45 | 0.49 | 0.62 | 0.59 |
| Financial leverage ratio | 1.97 | 2.05 | 2.07 | 2.32 | 2.29 |
Westlake Chemical Corporation's solvency ratios indicate a generally positive trend over the years. The debt-to-assets ratio has decreased from 0.26 in 2020 to 0.22 in 2024, suggesting the company has been able to reduce its reliance on debt to finance its assets.
Similarly, the debt-to-capital ratio has declined from 0.37 in 2020 to 0.30 in 2024, demonstrating an improvement in the company's ability to cover its capital with debt.
Furthermore, the debt-to-equity ratio has shown a decreasing trend from 0.59 in 2020 to 0.43 in 2024, signaling a lowering reliance on debt relative to equity for financing.
Additionally, the financial leverage ratio has decreased from 2.29 in 2020 to 1.97 in 2024, indicating a reduction in financial risk and potential volatility associated with debt financing.
Overall, the solvency ratios of Westlake Chemical Corporation reflect a favorable trajectory, showcasing an improvement in the company's financial health and stability over the specified period.
Coverage ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Interest coverage | 67.31 | 4.98 | 17.36 | 15.90 | 3.03 |
Westlake Chemical Corporation's interest coverage ratio has shown fluctuations over the past five years. As of December 31, 2020, the interest coverage was relatively low at 3.03, indicating a lower ability to cover interest expenses with operating income. However, the company saw a significant improvement in its interest coverage for the subsequent years, reaching 15.90 in 2021 and further increasing to 17.36 in 2022, reflecting a stronger ability to meet interest obligations.
In 2023, the interest coverage ratio dropped to 4.98, suggesting a decrease in the company's ability to cover interest expenses. The most notable change occurred in 2024, where the interest coverage ratio surged to 67.31, signaling a substantial improvement and a highly favorable position to cover interest costs.
Overall, the trend in Westlake Chemical Corporation's interest coverage indicates some variability, but the company has managed to strengthen its ability to handle interest payments efficiently over the years, with a particularly remarkable improvement in 2024.