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)
Debt Ratios
Coverage Ratios
AmerisourceBergen Corp., solvency ratios
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
The solvency profile of the organization exhibits a period of relative stability from 2017 through 2019, followed by significant volatility in 2020 and a structural shift in leverage ratios in 2021. While asset-based debt ratios remained consistently low, equity-based leverage and coverage metrics show substantial fluctuations.
- Leverage and Capital Structure
- Debt to assets remained stable throughout the period, fluctuating narrowly between 0.09 and 0.14. This indicates that total debt has consistently represented a small fraction of the total asset base. However, the debt to equity ratio experienced a dramatic increase, rising from 1.45 in 2019 to 29.93 in 2021. This spike is mirrored in the financial leverage ratio, which climbed from 13.61 in 2019 to 256.71 in 2021. Given the stability of the debt to assets ratio, these changes suggest a significant reduction in shareholder equity rather than a proportional surge in total debt.
- Capitalization Trends
- The debt to capital ratio showed a gradual decline from 0.63 in 2017 to 0.59 in 2019. A sharp increase occurred in 2020, reaching 1.33, before moderating to 0.97 in 2021 and 1.04 in 2022. The inclusion of operating lease liabilities resulted in nearly identical trends, with only marginal increases in the ratios, indicating that lease obligations do not fundamentally alter the solvency risk profile.
- Coverage Ratios and Earnings Stability
- Interest coverage and fixed charge coverage ratios remained healthy between 2017 and 2019, with interest coverage moving from 7.16 to 5.95. A severe anomaly occurred in 2020, where interest coverage dropped to -32.39 and fixed charge coverage fell to -18.13, signaling a period of negative earnings before interest and taxes. A strong recovery followed in 2021, with interest coverage peaking at 13.17, before settling at 10.41 in 2022. This indicates a return to a robust capacity to service debt obligations following the 2020 downturn.
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Debt to Equity
AmerisourceBergen Corp., debt to equity calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Short-term debt | 1,070,473) | 300,213) | 501,259) | 139,012) | 151,657) | 12,121) | |
| Long-term debt, net of current portion | 4,632,360) | 6,383,711) | 3,618,261) | 4,033,880) | 4,158,532) | 3,429,934) | |
| Total debt | 5,702,833) | 6,683,924) | 4,119,520) | 4,172,892) | 4,310,189) | 3,442,055) | |
| Total AmerisourceBergen Corporation stockholders’ equity (deficit) | (211,559) | 223,354) | (1,018,924) | 2,878,917) | 2,932,824) | 2,064,461) | |
| Solvency Ratio | |||||||
| Debt to equity1 | — | 29.93 | — | 1.45 | 1.47 | 1.67 | |
| Benchmarks | |||||||
| Debt to Equity, Competitors2 | |||||||
| Abbott Laboratories | 0.46 | 0.50 | — | — | — | — | |
| Elevance Health Inc. | 0.66 | 0.64 | — | — | — | — | |
| Intuitive Surgical Inc. | 0.00 | 0.00 | — | — | — | — | |
| Medtronic PLC | 0.46 | 0.51 | — | — | — | — | |
| UnitedHealth Group Inc. | 0.74 | 0.64 | — | — | — | — | |
| Debt to Equity, Sector | |||||||
| Health Care Equipment & Services | 0.57 | 0.55 | — | — | — | — | |
| Debt to Equity, Industry | |||||||
| Health Care | 0.72 | 0.80 | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 2022 Calculation
Debt to equity = Total debt ÷ Total AmerisourceBergen Corporation stockholders’ equity (deficit)
= 5,702,833 ÷ -211,559 = —
2 Click competitor name to see calculations.
The financial solvency profile of the organization exhibits significant volatility between 2017 and 2022, characterized by a substantial increase in leverage and recurring deficits in stockholders' equity.
- Total Debt Trends
- A general upward trajectory in total debt is observed from 2017 through 2021, rising from 3.44 billion to a peak of 6.68 billion. While there was a period of relative stability between 2018 and 2020, a sharp increase occurred in 2021. A subsequent reduction to 5.70 billion was noted by September 30, 2022.
- Stockholders' Equity Analysis
- Equity levels demonstrate extreme fluctuations. After reaching a peak of approximately 2.93 billion in 2018, a precipitous decline occurred in 2020, resulting in a deficit of 1.02 billion. Although equity returned to a positive balance of 223 million in 2021, it reverted to a deficit of 211 million by 2022, indicating a recurring pattern of capital erosion or aggressive capital return strategies.
- Debt to Equity Ratio Interpretation
- The debt to equity ratio remained stable and improved slightly from 1.67 in 2017 to 1.45 in 2019. However, the ratio became distorted in later periods due to the equity deficits. In 2021, the ratio spiked to 29.93, reflecting a precarious balance between high total debt and a nominal equity base. The absence of a ratio for 2020 and 2022 is a direct result of the negative equity positions, which renders traditional solvency ratios mathematically inapplicable.
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Debt to Equity (including Operating Lease Liability)
AmerisourceBergen Corp., debt to equity (including operating lease liability) calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Short-term debt | 1,070,473) | 300,213) | 501,259) | 139,012) | 151,657) | 12,121) | |
| Long-term debt, net of current portion | 4,632,360) | 6,383,711) | 3,618,261) | 4,033,880) | 4,158,532) | 3,429,934) | |
| Total debt | 5,702,833) | 6,683,924) | 4,119,520) | 4,172,892) | 4,310,189) | 3,442,055) | |
| Operating lease liabilities (included in Accrued expenses and other) | 158,184) | 175,352) | 92,587) | —) | —) | —) | |
| Operating lease liabilities (included in Other long-term liabilities) | 864,288) | 946,155) | 385,507) | —) | —) | —) | |
| Total debt (including operating lease liability) | 6,725,305) | 7,805,431) | 4,597,614) | 4,172,892) | 4,310,189) | 3,442,055) | |
| Total AmerisourceBergen Corporation stockholders’ equity (deficit) | (211,559) | 223,354) | (1,018,924) | 2,878,917) | 2,932,824) | 2,064,461) | |
| Solvency Ratio | |||||||
| Debt to equity (including operating lease liability)1 | — | 34.95 | — | 1.45 | 1.47 | 1.67 | |
| Benchmarks | |||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | |||||||
| Abbott Laboratories | 0.49 | 0.54 | — | — | — | — | |
| Elevance Health Inc. | 0.69 | 0.67 | — | — | — | — | |
| Intuitive Surgical Inc. | 0.01 | 0.01 | — | — | — | — | |
| Medtronic PLC | 0.48 | 0.53 | — | — | — | — | |
| UnitedHealth Group Inc. | 0.80 | 0.70 | — | — | — | — | |
| Debt to Equity (including Operating Lease Liability), Sector | |||||||
| Health Care Equipment & Services | 0.61 | 0.58 | — | — | — | — | |
| Debt to Equity (including Operating Lease Liability), Industry | |||||||
| Health Care | 0.76 | 0.83 | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 2022 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Total AmerisourceBergen Corporation stockholders’ equity (deficit)
= 6,725,305 ÷ -211,559 = —
2 Click competitor name to see calculations.
The solvency profile exhibits significant volatility between 2017 and 2022, characterized by a substantial increase in total liabilities coupled with extreme fluctuations in stockholders' equity. This combination has led to an unstable debt-to-equity relationship, moving from a manageable leverage position to periods of equity deficits.
- Total Debt Trends
- Total debt, including operating lease liabilities, demonstrated a general upward trajectory, increasing from US$ 3.44 billion in 2017 to a peak of US$ 7.81 billion in 2021. Although a reduction to US$ 6.73 billion occurred by September 30, 2022, the overall debt burden remained nearly double the 2017 levels.
- Stockholders' Equity Volatility
- Equity experienced severe instability, shifting from a positive position of US$ 2.93 billion in 2018 to a deficit of US$ 1.02 billion in 2020. While a brief recovery to a positive balance of US$ 223 million was recorded in 2021, the company returned to a deficit of US$ 211.56 million by 2022.
- Debt to Equity Ratio Analysis
- From 2017 to 2019, the debt-to-equity ratio remained relatively stable, trending slightly downward from 1.67 to 1.45. However, the ratio became distorted in subsequent years due to the erosion of the equity base. In 2021, the ratio spiked to 34.95, a direct result of the high debt load coinciding with a critically low positive equity balance. The absence of ratio values in 2020 and 2022 corresponds with the periods where stockholders' equity was in a deficit, rendering the standard ratio calculation non-representative of solvency.
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Debt to Capital
AmerisourceBergen Corp., debt to capital calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Short-term debt | 1,070,473) | 300,213) | 501,259) | 139,012) | 151,657) | 12,121) | |
| Long-term debt, net of current portion | 4,632,360) | 6,383,711) | 3,618,261) | 4,033,880) | 4,158,532) | 3,429,934) | |
| Total debt | 5,702,833) | 6,683,924) | 4,119,520) | 4,172,892) | 4,310,189) | 3,442,055) | |
| Total AmerisourceBergen Corporation stockholders’ equity (deficit) | (211,559) | 223,354) | (1,018,924) | 2,878,917) | 2,932,824) | 2,064,461) | |
| Total capital | 5,491,274) | 6,907,278) | 3,100,596) | 7,051,809) | 7,243,013) | 5,506,516) | |
| Solvency Ratio | |||||||
| Debt to capital1 | 1.04 | 0.97 | 1.33 | 0.59 | 0.60 | 0.63 | |
| Benchmarks | |||||||
| Debt to Capital, Competitors2 | |||||||
| Abbott Laboratories | 0.31 | 0.34 | — | — | — | — | |
| Elevance Health Inc. | 0.40 | 0.39 | — | — | — | — | |
| Intuitive Surgical Inc. | 0.00 | 0.00 | — | — | — | — | |
| Medtronic PLC | 0.31 | 0.34 | — | — | — | — | |
| UnitedHealth Group Inc. | 0.43 | 0.39 | — | — | — | — | |
| Debt to Capital, Sector | |||||||
| Health Care Equipment & Services | 0.36 | 0.35 | — | — | — | — | |
| Debt to Capital, Industry | |||||||
| Health Care | 0.42 | 0.44 | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 2022 Calculation
Debt to capital = Total debt ÷ Total capital
= 5,702,833 ÷ 5,491,274 = 1.04
2 Click competitor name to see calculations.
The solvency profile of AmerisourceBergen Corp. experienced significant volatility between 2017 and 2022. An initial period of stability and slight deleveraging from 2017 to 2019 was followed by a sharp increase in leverage starting in 2020, with the company maintaining a high debt-to-capital ratio through the end of the analyzed period.
- Total Debt Trends
- Total debt exhibited a general upward trajectory, rising from US$ 3.44 billion in 2017 to a peak of US$ 6.68 billion in 2021. While a reduction to US$ 5.70 billion occurred in 2022, the debt load remained substantially elevated compared to the 2017 baseline.
- Total Capital Volatility
- The total capital base showed marked instability, specifically in 2020, when it contracted to US$ 3.10 billion from US$ 7.05 billion in the previous year. Following this decline, capital recovered to US$ 6.91 billion in 2021 before decreasing again to US$ 5.49 billion in 2022.
- Debt to Capital Ratio Analysis
- Between 2017 and 2019, the debt to capital ratio improved marginally from 0.63 to 0.59. A critical shift occurred in 2020, where the ratio spiked to 1.33, indicating that total debt exceeded total capital. Although the ratio moderated to 0.97 in 2021, it rose to 1.04 by September 30, 2022, signaling a highly leveraged capital structure where debt accounts for more than 100% of total capital.
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Debt to Capital (including Operating Lease Liability)
AmerisourceBergen Corp., debt to capital (including operating lease liability) calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Short-term debt | 1,070,473) | 300,213) | 501,259) | 139,012) | 151,657) | 12,121) | |
| Long-term debt, net of current portion | 4,632,360) | 6,383,711) | 3,618,261) | 4,033,880) | 4,158,532) | 3,429,934) | |
| Total debt | 5,702,833) | 6,683,924) | 4,119,520) | 4,172,892) | 4,310,189) | 3,442,055) | |
| Operating lease liabilities (included in Accrued expenses and other) | 158,184) | 175,352) | 92,587) | —) | —) | —) | |
| Operating lease liabilities (included in Other long-term liabilities) | 864,288) | 946,155) | 385,507) | —) | —) | —) | |
| Total debt (including operating lease liability) | 6,725,305) | 7,805,431) | 4,597,614) | 4,172,892) | 4,310,189) | 3,442,055) | |
| Total AmerisourceBergen Corporation stockholders’ equity (deficit) | (211,559) | 223,354) | (1,018,924) | 2,878,917) | 2,932,824) | 2,064,461) | |
| Total capital (including operating lease liability) | 6,513,746) | 8,028,785) | 3,578,690) | 7,051,809) | 7,243,013) | 5,506,516) | |
| Solvency Ratio | |||||||
| Debt to capital (including operating lease liability)1 | 1.03 | 0.97 | 1.28 | 0.59 | 0.60 | 0.63 | |
| Benchmarks | |||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | |||||||
| Abbott Laboratories | 0.33 | 0.35 | — | — | — | — | |
| Elevance Health Inc. | 0.41 | 0.40 | — | — | — | — | |
| Intuitive Surgical Inc. | 0.01 | 0.01 | — | — | — | — | |
| Medtronic PLC | 0.32 | 0.35 | — | — | — | — | |
| UnitedHealth Group Inc. | 0.45 | 0.41 | — | — | — | — | |
| Debt to Capital (including Operating Lease Liability), Sector | |||||||
| Health Care Equipment & Services | 0.38 | 0.37 | — | — | — | — | |
| Debt to Capital (including Operating Lease Liability), Industry | |||||||
| Health Care | 0.43 | 0.45 | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 2022 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 6,725,305 ÷ 6,513,746 = 1.03
2 Click competitor name to see calculations.
Between 2017 and 2022, the company's solvency profile shifted from a conservative capital structure to a highly leveraged position characterized by significant volatility in total capital and instances where debt exceeded total capital.
- Debt to Capital Ratio Trends
- From 2017 to 2019, the debt to capital ratio remained stable with a slight downward trajectory, moving from 0.63 to 0.59. A sharp escalation occurred in 2020, with the ratio peaking at 1.28, signaling that total debt had surpassed total capital. Although the ratio moderated to 0.97 in 2021, it increased again to 1.03 by September 30, 2022, indicating a return to a state where liabilities exceed total capital.
- Total Debt Trajectory
- Total debt, inclusive of operating lease liabilities, demonstrated a general upward trend for the majority of the period. Debt levels rose from US$ 3.44 billion in 2017 to a peak of US$ 7.81 billion in 2021. A reduction to US$ 6.73 billion was noted in 2022, though the debt burden remained substantially higher than the levels recorded in the 2017-2020 period.
- Total Capital Volatility
- Total capital experienced extreme fluctuations, most notably in 2020 when it declined sharply to US$ 3.58 billion from US$ 7.05 billion the previous year. This contraction was the primary driver for the spike in the debt to capital ratio during that period. A significant recovery was observed in 2021, with capital reaching US$ 8.03 billion, followed by a decline to US$ 6.51 billion in 2022.
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Debt to Assets
AmerisourceBergen Corp., debt to assets calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Short-term debt | 1,070,473) | 300,213) | 501,259) | 139,012) | 151,657) | 12,121) | |
| Long-term debt, net of current portion | 4,632,360) | 6,383,711) | 3,618,261) | 4,033,880) | 4,158,532) | 3,429,934) | |
| Total debt | 5,702,833) | 6,683,924) | 4,119,520) | 4,172,892) | 4,310,189) | 3,442,055) | |
| Total assets | 56,560,616) | 57,337,805) | 44,274,830) | 39,171,980) | 37,669,838) | 35,316,470) | |
| Solvency Ratio | |||||||
| Debt to assets1 | 0.10 | 0.12 | 0.09 | 0.11 | 0.11 | 0.10 | |
| Benchmarks | |||||||
| Debt to Assets, Competitors2 | |||||||
| Abbott Laboratories | 0.23 | 0.24 | — | — | — | — | |
| Elevance Health Inc. | 0.23 | 0.24 | — | — | — | — | |
| Intuitive Surgical Inc. | 0.00 | 0.00 | — | — | — | — | |
| Medtronic PLC | 0.27 | 0.28 | — | — | — | — | |
| UnitedHealth Group Inc. | 0.23 | 0.22 | — | — | — | — | |
| Debt to Assets, Sector | |||||||
| Health Care Equipment & Services | 0.23 | 0.23 | — | — | — | — | |
| Debt to Assets, Industry | |||||||
| Health Care | 0.28 | 0.30 | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 2022 Calculation
Debt to assets = Total debt ÷ Total assets
= 5,702,833 ÷ 56,560,616 = 0.10
2 Click competitor name to see calculations.
The solvency profile remains remarkably stable over the analyzed six-year period, characterized by a conservative approach to leverage. Despite significant fluctuations in the absolute values of both liabilities and assets, the proportional relationship between them indicates a disciplined capital structure management strategy.
- Asset and Debt Volatility
- Total assets exhibited a consistent growth trend from 2017 through 2021, rising from US$ 35.3 billion to a peak of US$ 57.3 billion. A similar, though more volatile, trend occurred with total debt, which increased from US$ 3.4 billion in 2017 to a peak of US$ 6.7 billion in 2021. The simultaneous surge in both metrics during the 2021 fiscal year suggests a substantial expansion of the balance sheet, potentially driven by strategic acquisitions or large-scale capital investments.
- Debt to Assets Ratio Interpretation
- The debt to assets ratio maintained a narrow range between 0.09 and 0.12, reflecting low financial risk and high solvency. Although total debt increased significantly by 2021, the ratio only shifted marginally to 0.12, confirming that the increase in debt was offset by a proportional increase in total assets. By September 30, 2022, the ratio returned to 0.10, aligning with the 2017 baseline and demonstrating a consistent capacity to balance debt obligations against the asset base.
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Debt to Assets (including Operating Lease Liability)
AmerisourceBergen Corp., debt to assets (including operating lease liability) calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Short-term debt | 1,070,473) | 300,213) | 501,259) | 139,012) | 151,657) | 12,121) | |
| Long-term debt, net of current portion | 4,632,360) | 6,383,711) | 3,618,261) | 4,033,880) | 4,158,532) | 3,429,934) | |
| Total debt | 5,702,833) | 6,683,924) | 4,119,520) | 4,172,892) | 4,310,189) | 3,442,055) | |
| Operating lease liabilities (included in Accrued expenses and other) | 158,184) | 175,352) | 92,587) | —) | —) | —) | |
| Operating lease liabilities (included in Other long-term liabilities) | 864,288) | 946,155) | 385,507) | —) | —) | —) | |
| Total debt (including operating lease liability) | 6,725,305) | 7,805,431) | 4,597,614) | 4,172,892) | 4,310,189) | 3,442,055) | |
| Total assets | 56,560,616) | 57,337,805) | 44,274,830) | 39,171,980) | 37,669,838) | 35,316,470) | |
| Solvency Ratio | |||||||
| Debt to assets (including operating lease liability)1 | 0.12 | 0.14 | 0.10 | 0.11 | 0.11 | 0.10 | |
| Benchmarks | |||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | |||||||
| Abbott Laboratories | 0.24 | 0.26 | — | — | — | — | |
| Elevance Health Inc. | 0.24 | 0.25 | — | — | — | — | |
| Intuitive Surgical Inc. | 0.01 | 0.01 | — | — | — | — | |
| Medtronic PLC | 0.27 | 0.29 | — | — | — | — | |
| UnitedHealth Group Inc. | 0.25 | 0.24 | — | — | — | — | |
| Debt to Assets (including Operating Lease Liability), Sector | |||||||
| Health Care Equipment & Services | 0.25 | 0.25 | — | — | — | — | |
| Debt to Assets (including Operating Lease Liability), Industry | |||||||
| Health Care | 0.29 | 0.31 | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 2022 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 6,725,305 ÷ 56,560,616 = 0.12
2 Click competitor name to see calculations.
The solvency profile from 2017 to 2022 reflects a period of significant balance sheet expansion, characterized by a simultaneous increase in both total assets and total debt. While the absolute volume of liabilities grew, the proportional reliance on debt remained relatively low throughout the analyzed period.
- Total Debt and Asset Expansion
- Total assets grew from US$ 35.32 billion in 2017 to US$ 56.56 billion in 2022. During this same interval, total debt, inclusive of operating lease liabilities, increased from US$ 3.44 billion to US$ 6.73 billion. The most pronounced surge in debt occurred between 2020 and 2021, during which liabilities rose from US$ 4.60 billion to US$ 7.81 billion.
- Debt to Assets Ratio Dynamics
- The debt to assets ratio remained stable between 0.10 and 0.11 from 2017 through 2020. A peak was reached in 2021, with the ratio ascending to 0.14, corresponding with the sharp increase in total debt. By 2022, the ratio moderated to 0.12 as total debt decreased by approximately US$ 1.08 billion while total assets remained relatively flat.
- Solvency Trend Analysis
- The observed trends indicate a conservative approach to leverage. Even at the 2021 peak, only 14% of total assets were financed through debt and operating lease liabilities. The consistent maintenance of the ratio near or below 0.12 suggests a strong solvency position and a high degree of financial flexibility.
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Financial Leverage
AmerisourceBergen Corp., financial leverage calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Total assets | 56,560,616) | 57,337,805) | 44,274,830) | 39,171,980) | 37,669,838) | 35,316,470) | |
| Total AmerisourceBergen Corporation stockholders’ equity (deficit) | (211,559) | 223,354) | (1,018,924) | 2,878,917) | 2,932,824) | 2,064,461) | |
| Solvency Ratio | |||||||
| Financial leverage1 | — | 256.71 | — | 13.61 | 12.84 | 17.11 | |
| Benchmarks | |||||||
| Financial Leverage, Competitors2 | |||||||
| Abbott Laboratories | 2.03 | 2.10 | — | — | — | — | |
| Elevance Health Inc. | 2.83 | 2.70 | — | — | — | — | |
| Intuitive Surgical Inc. | 1.17 | 1.14 | — | — | — | — | |
| Medtronic PLC | 1.73 | 1.81 | — | — | — | — | |
| UnitedHealth Group Inc. | 3.16 | 2.96 | — | — | — | — | |
| Financial Leverage, Sector | |||||||
| Health Care Equipment & Services | 2.46 | 2.37 | — | — | — | — | |
| Financial Leverage, Industry | |||||||
| Health Care | 2.57 | 2.69 | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 2022 Calculation
Financial leverage = Total assets ÷ Total AmerisourceBergen Corporation stockholders’ equity (deficit)
= 56,560,616 ÷ -211,559 = —
2 Click competitor name to see calculations.
The financial position of the organization is characterized by steady asset growth contrasted with significant volatility and instability in stockholders' equity over the analyzed six-year period. While the asset base expanded consistently until 2021, the equity position shifted from positive values to deficits, leading to extreme fluctuations in financial leverage.
- Asset Growth Trends
- Total assets demonstrated a consistent upward trajectory from September 30, 2017, through September 30, 2021, increasing from approximately 35.3 billion US$ to 57.3 billion US$. This represents a substantial expansion of the balance sheet. A slight contraction occurred by September 30, 2022, with assets decreasing to 56.6 billion US$.
- Equity Volatility and Deficits
- Stockholders' equity exhibited severe instability. After peaking in 2018 and 2019 at approximately 2.9 billion US$, the equity position collapsed into a deficit of 1.0 billion US$ by September 30, 2020. Although a brief recovery to a positive balance of 223.3 million US$ was recorded in 2021, the position returned to a deficit of 211.6 million US$ by September 30, 2022. The recurrence of stockholders' deficits indicates a high reliance on debt or significant capital distributions exceeding retained earnings.
- Financial Leverage Analysis
- The financial leverage ratio shows an erratic pattern aligned with the equity fluctuations. Between 2017 and 2019, leverage remained relatively stable, ranging from 12.84 to 17.11. However, a critical spike occurred on September 30, 2021, where the ratio reached 256.71. This extreme value is a mathematical result of the very thin equity cushion (223.3 million US$) relative to the massive asset base (57.3 billion US$). The absence of ratios for 2020 and 2022 is attributable to the negative equity positions, during which traditional leverage ratios become non-meaningful or undefined.
In summary, the solvency profile suggests a transition from a moderately leveraged position to a highly aggressive capital structure. The combination of expanding assets and a recurring stockholders' deficit indicates a high degree of financial risk and a reliance on external financing to support operations and growth.
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Interest Coverage
AmerisourceBergen Corp., interest coverage calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net income (loss) attributable to AmerisourceBergen Corporation | 1,698,820) | 1,539,932) | (3,408,716) | 855,365) | 1,658,405) | 364,484) | |
| Add: Net income attributable to noncontrolling interest | (32,280) | 4,676) | 9,158) | (1,230) | (42,513) | —) | |
| Add: Income tax expense | 516,517) | 677,251) | (1,894,273) | 112,971) | (438,469) | 553,403) | |
| Add: Interest expense | 231,982) | 182,544) | 158,522) | 195,474) | 189,640) | 149,042) | |
| Earnings before interest and tax (EBIT) | 2,415,039) | 2,404,403) | (5,135,309) | 1,162,580) | 1,367,063) | 1,066,929) | |
| Solvency Ratio | |||||||
| Interest coverage1 | 10.41 | 13.17 | -32.39 | 5.95 | 7.21 | 7.16 | |
| Benchmarks | |||||||
| Interest Coverage, Competitors2 | |||||||
| Abbott Laboratories | 15.89 | 16.41 | — | — | — | — | |
| Elevance Health Inc. | 10.13 | 10.93 | — | — | — | — | |
| Intuitive Surgical Inc. | — | — | — | — | — | — | |
| Medtronic PLC | 10.98 | 5.21 | — | — | — | — | |
| UnitedHealth Group Inc. | 13.59 | 14.44 | — | — | — | — | |
| Interest Coverage, Sector | |||||||
| Health Care Equipment & Services | 13.22 | 12.30 | — | — | — | — | |
| Interest Coverage, Industry | |||||||
| Health Care | 14.75 | 14.14 | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 2022 Calculation
Interest coverage = EBIT ÷ Interest expense
= 2,415,039 ÷ 231,982 = 10.41
2 Click competitor name to see calculations.
The analysis of interest coverage between 2017 and 2022 reveals a period of significant volatility, marked by a severe operational downturn in 2020 and a subsequent robust recovery in solvency margins.
- Operating Income and Interest Expense Trends
- Earnings before interest and tax (EBIT) exhibited substantial fluctuations, peaking at 2.42 billion US dollars in 2022 after a precipitous decline to negative 5.14 billion US dollars in 2020. Concurrently, interest expenses showed a general upward trajectory, increasing from 149 million US dollars in 2017 to 232 million US dollars in 2022, thereby increasing the absolute cost of debt servicing over the analyzed period.
- Interest Coverage Ratio Volatility
- The interest coverage ratio remained relatively stable between 2017 and 2019, ranging from 5.95 to 7.21. A critical deficit occurred in 2020, where the ratio collapsed to -32.39, indicating that operating losses were severe enough to preclude the coverage of interest obligations from operating income. A sharp reversal occurred in 2021, with the ratio climbing to 13.17, before moderating to 10.41 in 2022.
- Solvency Recovery and Current Position
- The recovery observed in 2021 and 2022 demonstrates a significant improvement in the margin of safety for debt servicing. Despite the increase in total interest expenses, the substantial growth in EBIT since the 2020 trough has resulted in a current interest coverage ratio that exceeds the pre-2020 average, suggesting a strengthened capacity to meet fixed financial obligations relative to the 2017-2019 period.
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Fixed Charge Coverage
AmerisourceBergen Corp., fixed charge coverage calculation, comparison to benchmarks
| Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Net income (loss) attributable to AmerisourceBergen Corporation | 1,698,820) | 1,539,932) | (3,408,716) | 855,365) | 1,658,405) | 364,484) | |
| Add: Net income attributable to noncontrolling interest | (32,280) | 4,676) | 9,158) | (1,230) | (42,513) | —) | |
| Add: Income tax expense | 516,517) | 677,251) | (1,894,273) | 112,971) | (438,469) | 553,403) | |
| Add: Interest expense | 231,982) | 182,544) | 158,522) | 195,474) | 189,640) | 149,042) | |
| Earnings before interest and tax (EBIT) | 2,415,039) | 2,404,403) | (5,135,309) | 1,162,580) | 1,367,063) | 1,066,929) | |
| Add: Operating lease cost | 220,935) | 161,054) | 118,144) | 108,900) | 114,900) | 80,700) | |
| Earnings before fixed charges and tax | 2,635,974) | 2,565,457) | (5,017,165) | 1,271,480) | 1,481,963) | 1,147,629) | |
| Interest expense | 231,982) | 182,544) | 158,522) | 195,474) | 189,640) | 149,042) | |
| Operating lease cost | 220,935) | 161,054) | 118,144) | 108,900) | 114,900) | 80,700) | |
| Fixed charges | 452,917) | 343,598) | 276,666) | 304,374) | 304,540) | 229,742) | |
| Solvency Ratio | |||||||
| Fixed charge coverage1 | 5.82 | 7.47 | -18.13 | 4.18 | 4.87 | 5.00 | |
| Benchmarks | |||||||
| Fixed Charge Coverage, Competitors2 | |||||||
| Abbott Laboratories | 10.10 | 10.21 | — | — | — | — | |
| Elevance Health Inc. | 8.82 | 8.48 | — | — | — | — | |
| Intuitive Surgical Inc. | 63.52 | 93.66 | — | — | — | — | |
| Medtronic PLC | 7.79 | 4.31 | — | — | — | — | |
| UnitedHealth Group Inc. | 8.77 | 8.80 | — | — | — | — | |
| Fixed Charge Coverage, Sector | |||||||
| Health Care Equipment & Services | 9.07 | 8.36 | — | — | — | — | |
| Fixed Charge Coverage, Industry | |||||||
| Health Care | 10.95 | 10.48 | — | — | — | — | |
Based on: 10-K (reporting date: 2022-09-30), 10-K (reporting date: 2021-09-30), 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30).
1 2022 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= 2,635,974 ÷ 452,917 = 5.82
2 Click competitor name to see calculations.
The solvency profile exhibits significant volatility between 2017 and 2022, characterized by a gradual decline in coverage, a severe operational shock in 2020, and a subsequent recovery. While the company returned to a positive solvency position, the most recent period indicates a contraction in the coverage margin despite record earnings.
- Earnings Before Fixed Charges and Tax
- Operational earnings demonstrated extreme fluctuations over the six-year period. After peaking in 2018 at 1.48 billion USD, a substantial decline occurred in 2020, where earnings dropped to negative 5.02 billion USD. A sharp recovery followed in 2021 and 2022, with earnings reaching a period high of 2.64 billion USD by September 30, 2022.
- Fixed Charge Obligations
- Fixed charges followed a general upward trajectory, increasing from 229.74 million USD in 2017 to 452.92 million USD in 2022. The most significant increase occurred between 2021 and 2022, representing a growth of approximately 32% in annual fixed obligations.
- Fixed Charge Coverage Ratio
- The coverage ratio experienced a steady decline from 5.00 in 2017 to 4.18 in 2019. This was followed by a critical collapse to -18.13 in 2020, reflecting the inability of operational earnings to meet fixed obligations during that fiscal year. A strong rebound occurred in 2021, with the ratio peaking at 7.47. However, the ratio moderated to 5.82 by 2022, driven by the simultaneous increase in fixed charges despite the growth in earnings.
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