EDITION 5
Janus Henderson
Corporate Debt Index
The Corporate Debt Index is a long-term study into trends in company indebtedness around the world, the investment opportunities this provides and the risks it presents.
Companies paid a record
US$458bn
in interest in 2023/24,
up 24.4% year-on-year
Higher
interest
costs consumed
one eighth (12.4%)
of operating profits
in 2023/24
Janus Henderson
expects borrowing levels to continue to rise in 2024/25 but at an even slower pace,
up by 2.5% to a record US$8.38 trillion
All figures in US dollars, unless otherwise stated. As of September 30, 2024
Glossary
| Bond | A bond is parcel of debt. By buying a bond, investors give money to a borrower, usually for a fixed term and for a fixed rate of interest. Bonds can be bought and sold on financial markets, and the value changes over time with varying market conditions. |
| Cyclical Industry | The revenues and profits of an industry rise and fall over the course of an economic cycle. |
| EBIT | Earnings before interest and tax, commonly called operating profit. |
| Equity | The amount of money left over for shareholders if all a company’s assets were liquidated and its assets sold off. |
| Gearing | The ratio of debt to equity finance on the balance sheet – not to the market value of the shares; also called leverage. |
| Leverage | The ratio of debt to equity finance on the balance sheet – not to the market value of the shares; also called gearing. |
| Net Debt | All borrowings minus any cash or cash equivalents. |
| Running Yield | The interest paid on a bond divided by its current market value. |
| Volatility | Rapid, unpredictable, changeability. |
| Yield to Maturity | The interest paid on a bond divided by its current market value, taking account of the capital gain or loss that will occur when the bond matures and is repaid. |