Browse the out-of-the-box insights that score supplier financial risk — grouped by family, with the score and the rule that triggers each one.
| Insight | Parameter | |
|---|---|---|
Deep operating lossA. Operating margin — levelOperating margin: Latest value <= -10% The supplier lost more than 10% of revenue at operating level in the most recent year. Core trading is substantially loss-making, not marginally so. | Financial performanceFinancial health parameter |
Operating lossA. Operating margin — levelOperating margin: Latest value >= -10% AND Latest value <= 0% Operating costs exceeded revenue in the most recent year — the supplier's core trading activity lost money before interest and tax. | Financial performanceFinancial health parameter |
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Operating margin under 3% — almost no bufferA. Operating margin — levelOperating margin: Latest value >= 0% AND Latest value <= 3% The supplier is profitable but keeps under 3% of revenue after operating costs. A small cost increase or price concession would push it into loss. | Financial performanceFinancial health parameter |
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Operating margin in the normal range (3–15%)A. Operating margin — levelOperating margin: Latest value >= 3% AND Latest value <= 15% Between 3% and 15% of revenue is retained after operating costs — profitable, with a moderate buffer. Benchmark against sector peers before reading more into it. | Financial performanceFinancial health parameter |
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Healthy operating margin (15–20%)A. Operating margin — levelOperating margin: Latest value >= 15% AND Latest value <= 20% The supplier retains 15–20% of revenue after operating costs, indicating pricing power and room to absorb cost increases. | Financial performanceFinancial health parameter |
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Strong operating margin (20–30%)A. Operating margin — levelOperating margin: Latest value >= 20% AND Latest value <= 30% 20–30% of revenue is retained after operating costs — well above what most suppliers achieve. | Financial performanceFinancial health parameter |
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Exceptional operating margin (above 30%)A. Operating margin — levelOperating margin: Latest value >= 30% More than 30% of revenue is retained after operating costs — exceptional pricing power and a large buffer against cost shocks. | Financial performanceFinancial health parameter |
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Operating losses in each of the last three yearsA'. Operating margin — persistenceOperating margin: Value for consecutive periods (3 years) <= 0% The supplier has made an operating loss in every one of the last three financial years. The losses are structural rather than one bad year. | Financial performanceFinancial health parameter |
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Operating margin above 15% in each of the last three yearsA'. Operating margin — persistenceOperating margin: Value for consecutive periods (3 years) >= 15% Operating margin has stayed above 15% for three consecutive years — durable profitability rather than one strong year. | Financial performanceFinancial health parameter |
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Net loss after interest and taxB. Net margin — levelNet margin: Latest value <= 0% After interest, tax and all other costs the supplier made a loss in the most recent year — nothing was left to reinvest or add to reserves. | Financial performanceFinancial health parameter |
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Net margin positive but modest (0–10%)B. Net margin — levelNet margin: Latest value >= 0% AND Latest value <= 10% Between 0% and 10% of revenue reaches the bottom line after interest and tax — a normal outcome for a profitable supplier. | Financial performanceFinancial health parameter |
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Strong net margin (above 10%)B. Net margin — levelNet margin: Latest value >= 10% More than 10% of revenue survives interest and tax and reaches the bottom line. | Financial performanceFinancial health parameter |
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Negative return on assetsC. Return on assets — levelReturn on Assets (ROA): Latest value <= 0% The supplier's asset base produced a loss in the most recent year — capital tied up in the business consumed value rather than earning a return. | Financial performanceFinancial health parameter |
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Return on assets under 2%C. Return on assets — levelReturn on Assets (ROA): Latest value >= 0% AND Latest value <= 2% The asset base earns almost nothing — under 2% of assets employed comes back as profit each year. | Financial performanceFinancial health parameter |
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Return on assets 2–10%C. Return on assets — levelReturn on Assets (ROA): Latest value >= 2% AND Latest value <= 10% The asset base earns a positive but modest return of 2–10% a year. | Financial performanceFinancial health parameter |
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Return on assets 10–20%C. Return on assets — levelReturn on Assets (ROA): Latest value >= 10% AND Latest value <= 20% The supplier turns 10–20% of its asset base into profit each year — efficient use of capital. | Financial performanceFinancial health parameter |
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Return on assets above 20%C. Return on assets — levelReturn on Assets (ROA): Latest value >= 20% More than 20% of the asset base comes back as profit each year — highly productive capital deployment. Asset-light service businesses reach this level more easily than capital-intensive ones. | Financial performanceFinancial health parameter |
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Revenue down more than 25% over three yearsD. Revenue growth — levelRevenue: Total change for period (3 years) <= -25% Revenue is more than a quarter below its level three years ago — worse than −9% a year. The top line is contracting structurally. | Financial performanceFinancial health parameter |
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Revenue down 5–25% over three yearsD. Revenue growth — levelRevenue: Total change for period (3 years) >= -25% AND Total change for period (3 years) <= -5% Revenue has fallen by between 5% and 25% since three years ago — a shrinking top line, but not a collapse. | Financial performanceFinancial health parameter |
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Revenue flat to moderate growth over three yearsD. Revenue growth — levelRevenue: Total change for period (3 years) >= -5% AND Total change for period (3 years) <= 33% Revenue is between 5% below and 33% above its level three years ago — flat to roughly 10% a year. Adequate for a stable, mature business. Figures are nominal, so low single-digit growth may be a real-terms decline. | Financial performanceFinancial health parameter |
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Revenue up 33–73% over three yearsD. Revenue growth — levelRevenue: Total change for period (3 years) >= 33% AND Total change for period (3 years) <= 73% Revenue has grown by a third to three quarters since three years ago — roughly 10–20% a year. Solid, sustained top-line momentum. | Financial performanceFinancial health parameter |
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Revenue up more than 73% over three yearsD. Revenue growth — levelRevenue: Total change for period (3 years) >= 73% Revenue is more than 73% above its level three years ago — over 20% a year. Strong growth; check that margins and working capital are keeping pace. | Financial performanceFinancial health parameter |
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Revenue fell in each of the last three yearsD'. Revenue growth — persistenceRevenue: YoY change for consecutive periods (3 years) <= 0% Revenue declined in every one of the last three years — a consistent downward trend rather than one weak year in an otherwise stable series. | Financial performanceFinancial health parameter |
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Revenue grew more than 10% in each of the last three yearsD'. Revenue growth — persistenceRevenue: YoY change for consecutive periods (3 years) >= 10% Revenue grew by more than 10% in each of the last three years — consistent growth rather than a single strong year. | Financial performanceFinancial health parameter |
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Workforce cut by more than a quarter in one yearE. Headcount trend — levelHeadcount: Total change for period (1 year) <= -25% Headcount is more than 25% below the prior year. A reduction on this scale is normally a response to financial stress, a lost contract, or the exit of a business line. | Financial performanceFinancial health parameter |
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Workforce down 10–25% in one yearE. Headcount trend — levelHeadcount: Total change for period (1 year) >= -25% AND Total change for period (1 year) <= -10% Headcount has fallen by between 10% and 25% since the prior year — a material reduction in delivery capacity. | Financial performanceFinancial health parameter |
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Workforce broadly stableE. Headcount trend — levelHeadcount: Total change for period (1 year) >= -10% AND Total change for period (1 year) <= 5% Headcount is within 10% below and 5% above the prior year — no directional signal either way. | Financial performanceFinancial health parameter |
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Workforce growingE. Headcount trend — levelHeadcount: Total change for period (1 year) >= 5% Headcount is more than 5% above the prior year — management is adding delivery capacity, which normally signals confidence in future demand. | Financial performanceFinancial health parameter |
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Workforce shrank in each of the last three yearsE'. Headcount trend — persistenceHeadcount: YoY change for consecutive periods (3 years) <= 0% Headcount fell in every one of the last three years — a sustained contraction rather than one round of cuts. | Financial performanceFinancial health parameter |
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Workforce grew in each of the last three yearsE'. Headcount trend — persistenceHeadcount: YoY change for consecutive periods (3 years) >= 5% Headcount grew by at least 5% in every one of the last three years — sustained expansion of delivery capacity. | Financial performanceFinancial health parameter |
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Less than half of reported profit converts into cashF. Cash flow quality — levelCash Flow Quality Ratio: Latest value <= 0.5 Operating cash flow is under 50% of reported net profit. Profit is being recognised well ahead of the cash arriving, which points to collection problems, inventory build-up, or aggressive revenue recognition. | Financial performanceFinancial health parameter |
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Cash conversion weak (0.5–0.8)F. Cash flow quality — levelCash Flow Quality Ratio: Latest value >= 0.5 AND Latest value <= 0.8 Between 50% and 80% of reported profit is backed by operating cash. Partial conversion — worth monitoring rather than acting on. | Financial performanceFinancial health parameter |
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Cash conversion close to profit (0.8–1.0)F. Cash flow quality — levelCash Flow Quality Ratio: Latest value >= 0.8 AND Latest value <= 1.0 Operating cash flow is between 80% and 100% of reported net profit — most of the profit is arriving as cash, which is the normal pattern. | Financial performanceFinancial health parameter |
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Earnings fully backed by cashF. Cash flow quality — levelCash Flow Quality Ratio: Latest value >= 1.0 Operating cash flow exceeds reported net profit — every unit of profit is backed by cash actually received. Note that very high ratios usually reflect heavy depreciation in a capital-intensive business rather than exceptional earnings quality. | Financial performanceFinancial health parameter |
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Cash conversion below half of profit for two years runningF'. Cash flow quality — persistenceCash Flow Quality Ratio: Value for consecutive periods (2 years) <= 0.5 Operating cash flow has stayed under 50% of reported profit for two consecutive years. A repeated gap between profit and cash is an accounting-quality red flag rather than a timing effect. | Financial performanceFinancial health parameter |
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Earnings fully cash-backed for three years runningF'. Cash flow quality — persistenceCash Flow Quality Ratio: Value for consecutive periods (3 years) >= 1.0 Operating cash flow has matched or exceeded reported profit in each of the last three years — consistently high earnings quality. | Financial performanceFinancial health parameter |
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Free cash flow negative in the latest yearG. Free cash flow — levelFree Cash Flow: Latest value <= 0 After operating costs and capital investment the supplier consumed cash rather than generating it. One such year can reflect an investment cycle; repeated years cannot. | Financial performanceFinancial health parameter |
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Free cash flow positive in the latest yearG. Free cash flow — levelFree Cash Flow: Latest value >= 0 The supplier generated surplus cash after operating costs and capital investment — cash was available to repay debt, pay owners, or build a buffer. | Financial performanceFinancial health parameter |
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Free cash flow negative for three years runningG'. Free cash flow — persistenceFree Cash Flow: Value for consecutive periods (3 years) <= 0 The supplier has consumed cash after investment in each of the last three years. A business in this position depends on external capital or existing reserves to keep operating. | Financial performanceFinancial health parameter |
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Free cash flow positive for three years runningG'. Free cash flow — persistenceFree Cash Flow: Value for consecutive periods (3 years) >= 0 The supplier has generated surplus cash after investment in each of the last three years — a self-funding business rather than one reliant on outside capital. | Financial performanceFinancial health parameter |
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Short-term obligations substantially uncoveredH. Current ratio — levelCurrent Ratio: Latest value <= 0.75x Current assets cover less than three quarters of the liabilities falling due within a year. The supplier cannot meet its near-term obligations from its own short-term resources. | Liquidity and solvencyFinancial health parameter |
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Current liabilities exceed current assetsH. Current ratio — levelCurrent Ratio: Latest value >= 0.75x AND Latest value <= 1.0x There is less than one unit of short-term assets for every unit of short-term liabilities — the supplier is relying on new inflows, refinancing, or forbearance to meet obligations as they fall due. | Liquidity and solvencyFinancial health parameter |
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Short-term obligations only just coveredH. Current ratio — levelCurrent Ratio: Latest value >= 1.0x AND Latest value <= 1.3x Current assets cover short-term liabilities by less than 1.3 times. Cover exists but a delayed customer payment or an unexpected bill would erase it. | Liquidity and solvencyFinancial health parameter |
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Limited but adequate liquidity bufferH. Current ratio — levelCurrent Ratio: Latest value >= 1.3x AND Latest value <= 2.0x Short-term obligations are covered between 1.3 and 2 times over — a working buffer, without much slack. | Liquidity and solvencyFinancial health parameter |
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Comfortable liquidity bufferH. Current ratio — levelCurrent Ratio: Latest value >= 2.0x AND Latest value <= 3.0x Current assets cover short-term liabilities two to three times over — the supplier can absorb a payment delay or an unexpected cost without external help. | Liquidity and solvencyFinancial health parameter |
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Large liquidity bufferH. Current ratio — levelCurrent Ratio: Latest value >= 3.0x Short-term obligations are covered more than three times over. Note that an unusually high ratio can also indicate idle cash or slow-moving inventory rather than strength. | Liquidity and solvencyFinancial health parameter |
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Liquid assets cover less than half of short-term obligationsI. Quick ratio — levelQuick Ratio: Latest value <= 0.5x Excluding inventory, the supplier holds under 50 units of cash, investments and receivables for every 100 units of liabilities due within a year. It would have to sell stock to pay its bills. | Liquidity and solvencyFinancial health parameter |
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Liquid assets cover only part of short-term obligationsI. Quick ratio — levelQuick Ratio: Latest value >= 0.5x AND Latest value <= 1.0x Cash, short-term investments and receivables cover between half and all of the liabilities due within a year — partial coverage that depends on inventory converting to cash. | Liquidity and solvencyFinancial health parameter |
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Short-term obligations covered without relying on inventoryI. Quick ratio — levelQuick Ratio: Latest value >= 1.0x AND Latest value <= 1.5x Liquid assets alone cover short-term liabilities between one and one-and-a-half times — the normal position for a solvent business. | Liquidity and solvencyFinancial health parameter |
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Full liquidity coverage with a marginI. Quick ratio — levelQuick Ratio: Latest value >= 1.5x Cash, investments and receivables cover short-term liabilities more than one-and-a-half times over, with no dependence on selling inventory. | Liquidity and solvencyFinancial health parameter |
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Working capital negative for three years runningJ. Working capital — persistenceWorking Capital: Value for consecutive periods (3 years) <= 0 Current liabilities have exceeded current assets in each of the last three years. This is a structural funding model — the supplier operates on customer prepayments or continuous refinancing — not a temporary squeeze. | Liquidity and solvencyFinancial health parameter |
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Working capital positive for three years runningJ. Working capital — persistenceWorking Capital: Value for consecutive periods (3 years) >= 0 Current assets have exceeded current liabilities in each of the last three years — a consistently self-funded short-term position. | Liquidity and solvencyFinancial health parameter |
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Operations consumed cash in the latest yearK. Operating cash flow — levelOperating Cash Flow (OCF): Latest value <= 0 Day-to-day trading used more cash than it produced. Wages and suppliers were paid from reserves, borrowings, or new investment rather than from operations. | Liquidity and solvencyFinancial health parameter |
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Operations generated cash in the latest yearK. Operating cash flow — levelOperating Cash Flow (OCF): Latest value >= 0 Day-to-day trading produced cash rather than consuming it — the normal position for a going concern. | Liquidity and solvencyFinancial health parameter |
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Operations consumed cash for two years runningK'. Operating cash flow — persistenceOperating Cash Flow (OCF): Value for consecutive periods (2 years) <= 0 Trading has used more cash than it produced in each of the last two years. A business that cannot fund its own operations twice over depends on external capital to continue. | Liquidity and solvencyFinancial health parameter |
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Operations generated cash for three years runningK'. Operating cash flow — persistenceOperating Cash Flow (OCF): Value for consecutive periods (3 years) >= 0 Trading has produced cash in each of the last three years — a consistently self-funding operation. | Liquidity and solvencyFinancial health parameter |
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Borrowings more than three times owners' capitalL. Debt-to-equity — levelDebt-to-Equity Ratio: Latest value >= 3.0x For every unit of equity the owners have put in, the supplier has borrowed more than three. At this level of gearing a single adverse event can leave lenders, not owners, deciding the outcome. | Capital structureFinancial health parameter |
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Borrowings one-and-a-half to three times owners' capitalL. Debt-to-equity — levelDebt-to-Equity Ratio: Latest value >= 1.5x AND Latest value <= 3.0x The business is funded substantially more by debt than by equity. Serviceable in normal trading, but it leaves limited headroom if earnings fall or rates rise. | Capital structureFinancial health parameter |
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Debt and equity funding broadly balancedL. Debt-to-equity — levelDebt-to-Equity Ratio: Latest value >= 0.5x AND Latest value <= 1.5x Borrowings are between half and one-and-a-half times owners' capital — a moderate structure. Contextualise against industry norms. | Capital structureFinancial health parameter |
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Primarily equity-fundedL. Debt-to-equity — levelDebt-to-Equity Ratio: Latest value >= 0.1x AND Latest value <= 0.5x Borrowings are under half of owners' capital — the business is funded mainly by its owners, so debt service is a small claim on earnings. | Capital structureFinancial health parameter |
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Effectively debt-freeL. Debt-to-equity — levelDebt-to-Equity Ratio: Latest value >= 0x AND Latest value <= 0.1x The supplier carries almost no interest-bearing debt relative to owners' capital. There is no meaningful debt-service obligation and no lender able to force events. | Capital structureFinancial health parameter |
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Borrowings above six years of earningsM. Debt-to-EBITDA — levelDebt-to-EBITDA Ratio: Latest value >= 6.0x It would take more than six years of current earnings to repay the supplier's borrowings. This is the leverage level lenders treat as distressed and is a common precursor to restructuring. | Capital structureFinancial health parameter |
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Borrowings above five years of earningsM. Debt-to-EBITDA — levelDebt-to-EBITDA Ratio: Latest value >= 5.0x AND Latest value <= 6.0x Repaying borrowings would take over five years of current earnings — highly leveraged, with little capacity to take on more debt or absorb an earnings fall. | Capital structureFinancial health parameter |
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Borrowings three to five years of earningsM. Debt-to-EBITDA — levelDebt-to-EBITDA Ratio: Latest value >= 3.0x AND Latest value <= 5.0x Borrowings represent three to five years of current earnings. Manageable while trading holds up, and normal in capital-intensive sectors, but the margin for error is narrowing. | Capital structureFinancial health parameter |
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Borrowings one-and-a-half to three years of earningsM. Debt-to-EBITDA — levelDebt-to-EBITDA Ratio: Latest value >= 1.5x AND Latest value <= 3.0x Debt is comfortably serviceable from current earnings. Capital-intensive businesses will sit at the upper end of this band as a matter of course. | Capital structureFinancial health parameter |
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Borrowings repayable in under eighteen months of earningsM. Debt-to-EBITDA — levelDebt-to-EBITDA Ratio: Latest value >= 0x AND Latest value <= 1.5x Current earnings would clear all borrowings in under a year and a half — the supplier's debt load is small relative to what the business earns. | Capital structureFinancial health parameter |
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Negative equity — liabilities exceed assetsN. Equity ratio — levelEquity Ratio: Latest value <= 0% The supplier's liabilities are larger than everything it owns. The owners' stake has been wiped out by accumulated losses, and the business continues only while creditors allow it to. | Capital structureFinancial health parameter |
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Very thin equity cushion (under 10%)N. Equity ratio — levelEquity Ratio: Latest value >= 0% AND Latest value <= 10% Owners have funded under a tenth of the asset base. Almost any loss eats directly into the buffer that stands between the supplier and a breach of lender terms. | Capital structureFinancial health parameter |
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Thin equity cushion (10–20%)N. Equity ratio — levelEquity Ratio: Latest value >= 10% AND Latest value <= 20% Between a tenth and a fifth of the asset base is owner-funded — a modest buffer for absorbing losses before lenders are affected. | Capital structureFinancial health parameter |
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Moderate equity funding (20–50%)N. Equity ratio — levelEquity Ratio: Latest value >= 20% AND Latest value <= 50% Between a fifth and a half of the asset base is funded by owners' capital. A normal range; read alongside industry norms. | Capital structureFinancial health parameter |
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Majority equity-funded (50–70%)N. Equity ratio — levelEquity Ratio: Latest value >= 50% AND Latest value <= 70% More than half the asset base is funded by the owners rather than by debt — losses can be absorbed without breaching lender terms. | Capital structureFinancial health parameter |
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Predominantly equity-funded (above 70%)N. Equity ratio — levelEquity Ratio: Latest value >= 70% Over 70% of the asset base is owner-funded. The supplier carries very little external claim on its assets. | Capital structureFinancial health parameter |
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Operating earnings do not cover the interest bill at allO. Interest coverage — levelInterest Coverage Ratio: Latest value <= 0x The supplier is not earning enough at operating level to pay its interest, let alone repay principal. Interest is being met from reserves, new borrowing, or not at all. | Capital structureFinancial health parameter |
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Interest bill barely coveredO. Interest coverage — levelInterest Coverage Ratio: Latest value >= 0x AND Latest value <= 1.5x Operating earnings cover interest less than one-and-a-half times over. Any dip in trading makes debt service unmanageable. | Capital structureFinancial health parameter |
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Interest cover thin (1.5–3 times)O. Interest coverage — levelInterest Coverage Ratio: Latest value >= 1.5x AND Latest value <= 3.0x Operating earnings cover the interest bill between one-and-a-half and three times — acceptable, but the lower end of this band warrants monitoring. | Capital structureFinancial health parameter |
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Interest comfortably covered (3–8 times)O. Interest coverage — levelInterest Coverage Ratio: Latest value >= 3.0x AND Latest value <= 8.0x Operating earnings cover interest three to eight times over — debt service is not a constraint on the business under normal trading. | Capital structureFinancial health parameter |
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Interest covered many times overO. Interest coverage — levelInterest Coverage Ratio: Latest value >= 8.0x Operating earnings cover the interest bill more than eight times. Debt service is immaterial relative to what the business earns. | Capital structureFinancial health parameter |
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Borrowings exceed cash heldP. Net debt position — levelNet Debt: Latest value >= 0 The supplier owes more to lenders than it holds in cash — the ordinary position for a business that uses debt funding. | Capital structureFinancial health parameter |
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Cash exceeds borrowingsP. Net debt position — levelNet Debt: Latest value <= 0 The supplier holds more cash than it owes to lenders — it could clear all its borrowings immediately and still have cash left. | Capital structureFinancial health parameter |
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Borrowings up by half or more over three yearsP'. Debt trendTotal debt: Total change for period (3 years) >= 50% Total borrowings are at least 50% higher than three years ago. The supplier is adding debt; whether that is investment or distress depends on whether earnings have kept pace. | Capital structureFinancial health parameter |
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Borrowings reduced by a quarter or more over three yearsP'. Debt trendTotal debt: Total change for period (3 years) <= -25% Total borrowings are at least 25% below their level three years ago — the supplier is actively deleveraging and reducing the claim lenders have on it. | Capital structureFinancial health parameter |
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