Analysis of Solvency Ratios
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
3M Co., solvency ratios
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio | A solvency ratio calculated as total debt divided by total shareholders’ equity. | 3M Co. debt to equity ratio improved from 2019 to 2020 and from 2020 to 2021. |
| Debt to equity ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total shareholders’ equity. | 3M Co. debt to equity ratio (including operating lease liability) improved from 2019 to 2020 and from 2020 to 2021. |
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | 3M Co. debt to capital ratio improved from 2019 to 2020 and from 2020 to 2021. |
| Debt to capital ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total debt (including operating lease liability) plus shareholders’ equity. | 3M Co. debt to capital ratio (including operating lease liability) improved from 2019 to 2020 and from 2020 to 2021. |
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | 3M Co. debt to assets ratio improved from 2019 to 2020 and from 2020 to 2021. |
| Debt to assets ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total assets. | 3M Co. debt to assets ratio (including operating lease liability) improved from 2019 to 2020 and from 2020 to 2021. |
| Financial leverage ratio | A solvency ratio calculated as total assets divided by total shareholders’ equity. | 3M Co. financial leverage ratio decreased from 2019 to 2020 and from 2020 to 2021. |
| Solvency ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | 3M Co. interest coverage ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | 3M Co. fixed charge coverage ratio improved from 2019 to 2020 and from 2020 to 2021. |
Debt to Equity
3M Co., debt to equity calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term borrowings and current portion of long-term debt | 1,307) | 806) | 2,795) | 1,211) | 1,853) | |
| Current obligations of finance leases | 7) | 22) | 21) | 17) | 13) | |
| Long-term debt, excluding current portion | 16,056) | 17,989) | 17,518) | 13,411) | 12,096) | |
| Finance leases, net of current obligations | 93) | 93) | 111) | 75) | 60) | |
| Total debt | 17,463) | 18,910) | 20,445) | 14,714) | 14,022) | |
| Total 3M Company shareholders’ equity | 15,046) | 12,867) | 10,063) | 9,796) | 11,563) | |
| Solvency Ratio | ||||||
| Debt to equity1 | 1.16 | 1.47 | 2.03 | 1.50 | 1.21 | |
| Benchmarks | ||||||
| Debt to Equity, Competitors2 | ||||||
| Boeing Co. | — | — | — | — | — | |
| Caterpillar Inc. | 2.29 | 2.42 | 2.58 | — | — | |
| Eaton Corp. plc | 0.52 | 0.54 | 0.52 | — | — | |
| GE Aerospace | 0.87 | 2.11 | 3.21 | — | — | |
| Honeywell International Inc. | 1.06 | 1.28 | 0.87 | — | — | |
| Lockheed Martin Corp. | 1.07 | 2.02 | 4.05 | — | — | |
| RTX Corp. | 0.43 | 0.44 | 1.04 | — | — | |
| Debt to Equity, Sector | ||||||
| Capital Goods | 1.26 | 1.75 | 2.08 | — | — | |
| Debt to Equity, Industry | ||||||
| Industrials | 1.24 | 1.72 | 1.84 | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Debt to equity = Total debt ÷ Total 3M Company shareholders’ equity
= 17,463 ÷ 15,046 = 1.16
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio | A solvency ratio calculated as total debt divided by total shareholders’ equity. | 3M Co. debt to equity ratio improved from 2019 to 2020 and from 2020 to 2021. |
Debt to Equity (including Operating Lease Liability)
3M Co., debt to equity (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term borrowings and current portion of long-term debt | 1,307) | 806) | 2,795) | 1,211) | 1,853) | |
| Current obligations of finance leases | 7) | 22) | 21) | 17) | 13) | |
| Long-term debt, excluding current portion | 16,056) | 17,989) | 17,518) | 13,411) | 12,096) | |
| Finance leases, net of current obligations | 93) | 93) | 111) | 75) | 60) | |
| Total debt | 17,463) | 18,910) | 20,445) | 14,714) | 14,022) | |
| Current operating lease liabilities | 263) | 256) | 247) | —) | —) | |
| Noncurrent operating lease liabilities | 591) | 609) | 607) | —) | —) | |
| Total debt (including operating lease liability) | 18,317) | 19,775) | 21,299) | 14,714) | 14,022) | |
| Total 3M Company shareholders’ equity | 15,046) | 12,867) | 10,063) | 9,796) | 11,563) | |
| Solvency Ratio | ||||||
| Debt to equity (including operating lease liability)1 | 1.22 | 1.54 | 2.12 | 1.50 | 1.21 | |
| Benchmarks | ||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | ||||||
| Boeing Co. | — | — | — | — | — | |
| Caterpillar Inc. | 2.33 | 2.46 | 2.62 | — | — | |
| Eaton Corp. plc | 0.55 | 0.57 | 0.55 | — | — | |
| GE Aerospace | 0.94 | 2.20 | 3.32 | — | — | |
| Honeywell International Inc. | 1.11 | 1.32 | 0.90 | — | — | |
| Lockheed Martin Corp. | 1.19 | 2.21 | 4.40 | — | — | |
| RTX Corp. | 0.46 | 0.47 | 1.11 | — | — | |
| Debt to Equity (including Operating Lease Liability), Sector | ||||||
| Capital Goods | 1.32 | 1.81 | 2.17 | — | — | |
| Debt to Equity (including Operating Lease Liability), Industry | ||||||
| Industrials | 1.38 | 1.87 | 1.94 | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Total 3M Company shareholders’ equity
= 18,317 ÷ 15,046 = 1.22
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total shareholders’ equity. | 3M Co. debt to equity ratio (including operating lease liability) improved from 2019 to 2020 and from 2020 to 2021. |
Debt to Capital
3M Co., debt to capital calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term borrowings and current portion of long-term debt | 1,307) | 806) | 2,795) | 1,211) | 1,853) | |
| Current obligations of finance leases | 7) | 22) | 21) | 17) | 13) | |
| Long-term debt, excluding current portion | 16,056) | 17,989) | 17,518) | 13,411) | 12,096) | |
| Finance leases, net of current obligations | 93) | 93) | 111) | 75) | 60) | |
| Total debt | 17,463) | 18,910) | 20,445) | 14,714) | 14,022) | |
| Total 3M Company shareholders’ equity | 15,046) | 12,867) | 10,063) | 9,796) | 11,563) | |
| Total capital | 32,509) | 31,777) | 30,508) | 24,510) | 25,585) | |
| Solvency Ratio | ||||||
| Debt to capital1 | 0.54 | 0.60 | 0.67 | 0.60 | 0.55 | |
| Benchmarks | ||||||
| Debt to Capital, Competitors2 | ||||||
| Boeing Co. | 1.35 | 1.40 | 1.46 | — | — | |
| Caterpillar Inc. | 0.70 | 0.71 | 0.72 | — | — | |
| Eaton Corp. plc | 0.34 | 0.35 | 0.34 | — | — | |
| GE Aerospace | 0.47 | 0.68 | 0.76 | — | — | |
| Honeywell International Inc. | 0.51 | 0.56 | 0.46 | — | — | |
| Lockheed Martin Corp. | 0.52 | 0.67 | 0.80 | — | — | |
| RTX Corp. | 0.30 | 0.31 | 0.51 | — | — | |
| Debt to Capital, Sector | ||||||
| Capital Goods | 0.56 | 0.64 | 0.68 | — | — | |
| Debt to Capital, Industry | ||||||
| Industrials | 0.55 | 0.63 | 0.65 | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Debt to capital = Total debt ÷ Total capital
= 17,463 ÷ 32,509 = 0.54
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | 3M Co. debt to capital ratio improved from 2019 to 2020 and from 2020 to 2021. |
Debt to Capital (including Operating Lease Liability)
3M Co., debt to capital (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term borrowings and current portion of long-term debt | 1,307) | 806) | 2,795) | 1,211) | 1,853) | |
| Current obligations of finance leases | 7) | 22) | 21) | 17) | 13) | |
| Long-term debt, excluding current portion | 16,056) | 17,989) | 17,518) | 13,411) | 12,096) | |
| Finance leases, net of current obligations | 93) | 93) | 111) | 75) | 60) | |
| Total debt | 17,463) | 18,910) | 20,445) | 14,714) | 14,022) | |
| Current operating lease liabilities | 263) | 256) | 247) | —) | —) | |
| Noncurrent operating lease liabilities | 591) | 609) | 607) | —) | —) | |
| Total debt (including operating lease liability) | 18,317) | 19,775) | 21,299) | 14,714) | 14,022) | |
| Total 3M Company shareholders’ equity | 15,046) | 12,867) | 10,063) | 9,796) | 11,563) | |
| Total capital (including operating lease liability) | 33,363) | 32,642) | 31,362) | 24,510) | 25,585) | |
| Solvency Ratio | ||||||
| Debt to capital (including operating lease liability)1 | 0.55 | 0.61 | 0.68 | 0.60 | 0.55 | |
| Benchmarks | ||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | ||||||
| Boeing Co. | 1.34 | 1.39 | 1.43 | — | — | |
| Caterpillar Inc. | 0.70 | 0.71 | 0.72 | — | — | |
| Eaton Corp. plc | 0.36 | 0.36 | 0.35 | — | — | |
| GE Aerospace | 0.49 | 0.69 | 0.77 | — | — | |
| Honeywell International Inc. | 0.53 | 0.57 | 0.47 | — | — | |
| Lockheed Martin Corp. | 0.54 | 0.69 | 0.81 | — | — | |
| RTX Corp. | 0.31 | 0.32 | 0.53 | — | — | |
| Debt to Capital (including Operating Lease Liability), Sector | ||||||
| Capital Goods | 0.57 | 0.64 | 0.68 | — | — | |
| Debt to Capital (including Operating Lease Liability), Industry | ||||||
| Industrials | 0.58 | 0.65 | 0.66 | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 18,317 ÷ 33,363 = 0.55
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to capital ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total debt (including operating lease liability) plus shareholders’ equity. | 3M Co. debt to capital ratio (including operating lease liability) improved from 2019 to 2020 and from 2020 to 2021. |
Debt to Assets
3M Co., debt to assets calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term borrowings and current portion of long-term debt | 1,307) | 806) | 2,795) | 1,211) | 1,853) | |
| Current obligations of finance leases | 7) | 22) | 21) | 17) | 13) | |
| Long-term debt, excluding current portion | 16,056) | 17,989) | 17,518) | 13,411) | 12,096) | |
| Finance leases, net of current obligations | 93) | 93) | 111) | 75) | 60) | |
| Total debt | 17,463) | 18,910) | 20,445) | 14,714) | 14,022) | |
| Total assets | 47,072) | 47,344) | 44,659) | 36,500) | 37,987) | |
| Solvency Ratio | ||||||
| Debt to assets1 | 0.37 | 0.40 | 0.46 | 0.40 | 0.37 | |
| Benchmarks | ||||||
| Debt to Assets, Competitors2 | ||||||
| Boeing Co. | 0.42 | 0.42 | 0.20 | — | — | |
| Caterpillar Inc. | 0.46 | 0.47 | 0.48 | — | — | |
| Eaton Corp. plc | 0.25 | 0.25 | 0.25 | — | — | |
| GE Aerospace | 0.18 | 0.30 | 0.34 | — | — | |
| Honeywell International Inc. | 0.30 | 0.35 | 0.27 | — | — | |
| Lockheed Martin Corp. | 0.23 | 0.24 | 0.27 | — | — | |
| RTX Corp. | 0.20 | 0.20 | 0.31 | — | — | |
| Debt to Assets, Sector | ||||||
| Capital Goods | 0.28 | 0.32 | 0.31 | — | — | |
| Debt to Assets, Industry | ||||||
| Industrials | 0.29 | 0.32 | 0.32 | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Debt to assets = Total debt ÷ Total assets
= 17,463 ÷ 47,072 = 0.37
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | 3M Co. debt to assets ratio improved from 2019 to 2020 and from 2020 to 2021. |
Debt to Assets (including Operating Lease Liability)
3M Co., debt to assets (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Short-term borrowings and current portion of long-term debt | 1,307) | 806) | 2,795) | 1,211) | 1,853) | |
| Current obligations of finance leases | 7) | 22) | 21) | 17) | 13) | |
| Long-term debt, excluding current portion | 16,056) | 17,989) | 17,518) | 13,411) | 12,096) | |
| Finance leases, net of current obligations | 93) | 93) | 111) | 75) | 60) | |
| Total debt | 17,463) | 18,910) | 20,445) | 14,714) | 14,022) | |
| Current operating lease liabilities | 263) | 256) | 247) | —) | —) | |
| Noncurrent operating lease liabilities | 591) | 609) | 607) | —) | —) | |
| Total debt (including operating lease liability) | 18,317) | 19,775) | 21,299) | 14,714) | 14,022) | |
| Total assets | 47,072) | 47,344) | 44,659) | 36,500) | 37,987) | |
| Solvency Ratio | ||||||
| Debt to assets (including operating lease liability)1 | 0.39 | 0.42 | 0.48 | 0.40 | 0.37 | |
| Benchmarks | ||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | ||||||
| Boeing Co. | 0.43 | 0.43 | 0.21 | — | — | |
| Caterpillar Inc. | 0.46 | 0.48 | 0.49 | — | — | |
| Eaton Corp. plc | 0.27 | 0.27 | 0.27 | — | — | |
| GE Aerospace | 0.19 | 0.31 | 0.35 | — | — | |
| Honeywell International Inc. | 0.32 | 0.36 | 0.28 | — | — | |
| Lockheed Martin Corp. | 0.26 | 0.26 | 0.29 | — | — | |
| RTX Corp. | 0.21 | 0.21 | 0.33 | — | — | |
| Debt to Assets (including Operating Lease Liability), Sector | ||||||
| Capital Goods | 0.29 | 0.33 | 0.33 | — | — | |
| Debt to Assets (including Operating Lease Liability), Industry | ||||||
| Industrials | 0.32 | 0.35 | 0.34 | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 18,317 ÷ 47,072 = 0.39
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to assets ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total assets. | 3M Co. debt to assets ratio (including operating lease liability) improved from 2019 to 2020 and from 2020 to 2021. |
Financial Leverage
3M Co., financial leverage calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Total assets | 47,072) | 47,344) | 44,659) | 36,500) | 37,987) | |
| Total 3M Company shareholders’ equity | 15,046) | 12,867) | 10,063) | 9,796) | 11,563) | |
| Solvency Ratio | ||||||
| Financial leverage1 | 3.13 | 3.68 | 4.44 | 3.73 | 3.29 | |
| Benchmarks | ||||||
| Financial Leverage, Competitors2 | ||||||
| Boeing Co. | — | — | — | — | — | |
| Caterpillar Inc. | 5.02 | 5.11 | 5.38 | — | — | |
| Eaton Corp. plc | 2.07 | 2.13 | 2.04 | — | — | |
| GE Aerospace | 4.93 | 7.13 | 9.40 | — | — | |
| Honeywell International Inc. | 3.47 | 3.68 | 3.17 | — | — | |
| Lockheed Martin Corp. | 4.64 | 8.43 | 15.20 | — | — | |
| RTX Corp. | 2.21 | 2.25 | 3.34 | — | — | |
| Financial Leverage, Sector | ||||||
| Capital Goods | 4.55 | 5.54 | 6.65 | — | — | |
| Financial Leverage, Industry | ||||||
| Industrials | 4.29 | 5.30 | 5.70 | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Financial leverage = Total assets ÷ Total 3M Company shareholders’ equity
= 47,072 ÷ 15,046 = 3.13
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Financial leverage ratio | A solvency ratio calculated as total assets divided by total shareholders’ equity. | 3M Co. financial leverage ratio decreased from 2019 to 2020 and from 2020 to 2021. |
Interest Coverage
3M Co., interest coverage calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income attributable to 3M | 5,921) | 5,384) | 4,570) | 5,349) | 4,858) | |
| Add: Net income attributable to noncontrolling interest | 8) | 4) | 12) | 14) | 11) | |
| Add: Income tax expense | 1,285) | 1,318) | 1,130) | 1,637) | 2,679) | |
| Add: Interest expense | 488) | 529) | 448) | 350) | 322) | |
| Earnings before interest and tax (EBIT) | 7,702) | 7,235) | 6,160) | 7,350) | 7,870) | |
| Solvency Ratio | ||||||
| Interest coverage1 | 15.78 | 13.68 | 13.75 | 21.00 | 24.44 | |
| Benchmarks | ||||||
| Interest Coverage, Competitors2 | ||||||
| Boeing Co. | -0.88 | -5.71 | -2.19 | — | — | |
| Caterpillar Inc. | 17.88 | 8.80 | 19.62 | — | — | |
| Eaton Corp. plc | 21.11 | 12.72 | 11.98 | — | — | |
| GE Aerospace | -0.96 | 2.59 | 1.27 | — | — | |
| Honeywell International Inc. | 22.09 | 17.75 | 22.17 | — | — | |
| Lockheed Martin Corp. | 14.27 | 14.93 | 12.09 | — | — | |
| RTX Corp. | 4.71 | -0.65 | 5.65 | — | — | |
| Interest Coverage, Sector | ||||||
| Capital Goods | 3.98 | 1.99 | 4.85 | — | — | |
| Interest Coverage, Industry | ||||||
| Industrials | 6.08 | 2.12 | 4.44 | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Interest coverage = EBIT ÷ Interest expense
= 7,702 ÷ 488 = 15.78
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | 3M Co. interest coverage ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |
Fixed Charge Coverage
3M Co., fixed charge coverage calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income attributable to 3M | 5,921) | 5,384) | 4,570) | 5,349) | 4,858) | |
| Add: Net income attributable to noncontrolling interest | 8) | 4) | 12) | 14) | 11) | |
| Add: Income tax expense | 1,285) | 1,318) | 1,130) | 1,637) | 2,679) | |
| Add: Interest expense | 488) | 529) | 448) | 350) | 322) | |
| Earnings before interest and tax (EBIT) | 7,702) | 7,235) | 6,160) | 7,350) | 7,870) | |
| Add: Operating lease cost | 319) | 348) | 308) | 393) | 343) | |
| Earnings before fixed charges and tax | 8,021) | 7,583) | 6,468) | 7,743) | 8,213) | |
| Interest expense | 488) | 529) | 448) | 350) | 322) | |
| Operating lease cost | 319) | 348) | 308) | 393) | 343) | |
| Fixed charges | 807) | 877) | 756) | 743) | 665) | |
| Solvency Ratio | ||||||
| Fixed charge coverage1 | 9.94 | 8.65 | 8.56 | 10.42 | 12.35 | |
| Benchmarks | ||||||
| Fixed Charge Coverage, Competitors2 | ||||||
| Boeing Co. | -0.64 | -4.75 | -1.19 | — | — | |
| Caterpillar Inc. | 12.73 | 6.58 | 13.01 | — | — | |
| Eaton Corp. plc | 10.40 | 6.24 | 7.45 | — | — | |
| GE Aerospace | -0.22 | 1.93 | 1.09 | — | — | |
| Honeywell International Inc. | 13.67 | 11.49 | 14.06 | — | — | |
| Lockheed Martin Corp. | 9.95 | 11.12 | 9.12 | — | — | |
| RTX Corp. | 3.66 | -0.22 | 4.31 | — | — | |
| Fixed Charge Coverage, Sector | ||||||
| Capital Goods | 3.06 | 1.66 | 3.63 | — | — | |
| Fixed Charge Coverage, Industry | ||||||
| Industrials | 3.98 | 1.64 | 3.00 | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= 8,021 ÷ 807 = 9.94
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | 3M Co. fixed charge coverage ratio improved from 2019 to 2020 and from 2020 to 2021. |