The key figures that decide creditworthiness

A set of accounts can seem overwhelming, but a few key figures tell you most of what you need to know about how solid a company is. Here are the most important ones – and how to read them.

Liquidity

The liquidity ratio shows whether the company can pay what falls due in the short term. If current assets exceed short-term debt, it stands more steadily.

Solidity

The equity ratio shows how large a share of the assets is financed with the company's own funds. High solidity provides a buffer against bad years.

Profitability

• Operating margin – does the company make money on its operations?
• Net margin – what is left on the bottom line?
• Development over several years – the trend matters more than a single year

See the whole picture

A single weak figure is rarely dangerous on its own. It is the combination – and the direction the figures are moving – that tells you whether creditworthiness is strengthening or weakening.