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Supply Network (ASX:SNL) Financial Strength : 6 (As of Dec. 2023)


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What is Supply Network Financial Strength?

Supply Network has the Financial Strength Rank of 6.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Supply Network's Interest Coverage for the quarter that ended in Dec. 2023 was 20.29. Supply Network's debt to revenue ratio for the quarter that ended in Dec. 2023 was 0.18. As of today, Supply Network's Altman Z-Score is 9.59.


Competitive Comparison of Supply Network's Financial Strength

For the Auto Parts subindustry, Supply Network's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Supply Network's Financial Strength Distribution in the Vehicles & Parts Industry

For the Vehicles & Parts industry and Consumer Cyclical sector, Supply Network's Financial Strength distribution charts can be found below:

* The bar in red indicates where Supply Network's Financial Strength falls into.



Supply Network Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Supply Network's Interest Expense for the months ended in Dec. 2023 was A$-1.1 Mil. Its Operating Income for the months ended in Dec. 2023 was A$22.4 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2023 was A$44.3 Mil.

Supply Network's Interest Coverage for the quarter that ended in Dec. 2023 is

Interest Coverage=-1*Operating Income (Q: Dec. 2023 )/Interest Expense (Q: Dec. 2023 )
=-1*22.423/-1.105
=20.29

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Supply Network's Debt to Revenue Ratio for the quarter that ended in Dec. 2023 is

Debt to Revenue Ratio=Total Debt (Q: Dec. 2023 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(9.223 + 44.258) / 290.688
=0.18

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Supply Network has a Z-score of 9.59, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 9.59 is strong.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Supply Network  (ASX:SNL) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Supply Network has the Financial Strength Rank of 6.


Supply Network Financial Strength Related Terms

Thank you for viewing the detailed overview of Supply Network's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Supply Network (ASX:SNL) Business Description

Traded in Other Exchanges
N/A
Address
1 Turnbull Close, Pemulwuy, Sydney, NSW, AUS, 2145
Supply Network Ltd is a company that engages in the provision of aftermarket parts to the commercial vehicle industry. It operates in Australia and New Zealand under the Multispares brand. The Group operates predominantly in one business segment the provision of aftermarket parts for the commercial vehicle market. The group derives the majority of its revenue from Australia.

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