Ratio

Debt Profile

1. How much and what percentage of Home Depots long-term debt matures during the next five fiscal years?

2. What are the average annual maturities? In other words, how much of Home Depot's debt matures in each of the next five years?

3. Approximately how much is annual interest expense (in dollars)?

4. Based on its long-term debt maturities and the companys cash flows, is Home Depots debt manageable? Why or why not do you think so?

2019 2018 2017 2016 2015 Fiscal Year 1) Calculate Current Ratio Current Assets Current Liabilities 19,810 18,529 18,933 17,724 16,484 18,375 16,716 16,194 14,133 12,526 Current Ratio 1.08 1.11 1.17 1.25 1.32 2) Calculate Leverage Ratios Short Term plus Long Term Debt 29,620 29,202 27,028 23,601 21,315 Total Liabilities 54,352 45,881 43,075 38,633 35,657 Stockholders' Equity -3,116 -1,878 1,454 4,333 6,316 Short Term plus Long Term Debt to Stockholder's Equity N/A N/A 18.59 5.45 3.37 Total Liabilities to Equity N/A N/A 29.63 8.92 5.65 3) Calculate Times Interest Earned Ratio Earnings before Income Taxes 14,715 14,556 13,698 12,491 11,021 Interest Expense 1,201 1,051 1,057 972 919 Times Interest Earned Ratio 13.25 14.85 13.96 13.85 12.99 4) Calculate EBITDA to Interest Expense Operating Income 15,843 15,530 14,681 13,427 11,774 + Depreciation and amortization (from cash flow statement) 2,296 2,152 2,062 1,973 1,863 = EBITDA 18,139 17,682 16,743 15,400 13,637 Interest Expense 1,201 1,051 1,057 972 919 EBITDA to Interest Expense 15.10 16.82 15.84 15.84 14.84 5) Calculate Short and Long Term Debt to EBITDA Short Term plus Long Term Debt 29,620 29,202 27,028 23,601 21,315 EBITDA 18,139 17,682 16,743 15,400 13,637 Short and Long Term Debt to EBITDA 1.63 1.65 1.61 1.53 1.56 29,620 29,202 27,028 23,601 21,315 6) Calculate Short and Long Term Debt to Discretionary Cash Flow Short Term plus Long Term Debt Net Cash Provided by Operating Activities - Capital Expenditures - Cash Divdends Paid 13,723 13,038 12,031 9,783 9,373; 2,678 2,442 1,897 1,621 1,503 5,958 4,704 4,212: 3,404 3,031 = Discretionary Cash Flow 5,087 5,892 5,922 4,758 4,839 Short and Long Term Debt to Discretionary Cash Flow 5.82 4.96 4.56 4.96 4.40 Maturity Month Year Annual Interest Maturities, Fiscal Years 2021 2022 2023 Principal Coupon 2020 2024 6 2020 10.00 500 2.00% 1.80% 3.95% 6 2020 13.50 500 750 500 1,000 1,350 750 9 2020 500 19.75 44.00 4.40% 4 2021 1,000 1,350 2.00% 2021 27.00 4 3 300 2.00% 2022 300 6.00 22.75 700 3.25% 3 2022 700 Description Senior Notes Floating Rate Notes Senior Notes Senior Notes Senior Notes Senior Notes Floating Rate Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes 2.63% 6 2022 32.81 1,250 2.70% 4 2023 27.00 1,000 3.75% 2 2024 41.25 1,100 9 2025 33.50 3.35% 3.00% 4 2026 39.00 1,250 1,000 1,100 1,000 1,300 1,000 1,000 1,000 1,750 3,000 2.13% 9 2026 21.25 2.80% 9 2027 28.00 12 2028 39.00 3.90% 2.95% 6 2029 51.63 5.88% 12 2036 176.25 500 5.40% 9 2040 27.00 5.95% 4 2041 59.50 4.20% 4 2043 42.00 4.88% 2 2044 48.75 4.40% 3 2045 44.00 Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes Senior Notes 4.25% 4 2046 68.00 1,000 1,000 1,000 1,000 1,600 1,150 1,500 1,250 1,000 29,500 3.90% 6 2047 44.85 4.50% 12 2048 67.50 3.13% 12 2049 39.06 3.50% 9 2056 35.00 Total 3.769 1,108.35 1,750 2,350 2,250 1,000 1,100 * weighted average