ArcelorMittal is a global steel producer headquartered in Luxembourg. The statement of financial position and statement of operations for the years 2006 to 2011 (source: annual reports 2006€“2011), prepared in accordance with IFRS, are provided as follows.

Required
1. Compute for the years 2006 to 2011 the first four €˜debt ratios€™ introduced in section 10 of this chapter: debt ratio, debt to equity ratio, long-term debt to equity ratio, and interest coverage ratio.
2. Analyze these ratios and their implication for better understanding the evolution of the firm mainly in terms of risk level and time horizon of visibility or survival. Note that non-controlling (minority) interests9 are often included in equity in the computation of ratios based on this concept.

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Consolidated statements of financial position in millions of USD December 31 2006 2010 2011 Assets Current assets: Cash and cash equivalents Restricted cash Short-term investments Trade accounts recevable and other Inventories Prepaid expenses and other current assets Assets held for sale Total current assets Non-current assets: Goodwill and intangible assets Property, plant and equipment Investments in associates and joint ventures Other investments Deferred tax assets Other assets Total non-current assets Total assets Liabilities and equity Current liabilities: Short-term debt and current portion of long-term debt4,922 Trade accounts payable and other Short-term provisions Accrued expenses and other liabilities Income tax liabilities Liabilities held for sale Total current liabilities Non-current liabilities: Long-term debt, net of current portion Deferred tax liabilities Deferred employee benefits Long-term provisions Other long-term obligations Total non-current liabilities Total liabilities Commitments and contingencies Equity: Common shares Treasury stock Additional paid-in capital Retained earrings Reserves Equity attributable to the equity holders of the 6,0207,8607,576 5,919 90 6,207 82 3,821 84 245 8,7699,533 6,737 5,725 19,238 21,750 24,741 16,835 19,583 21,689 3,559 3,942 4,644 1,267 1296 4,439 6,918 39,362 45,328 44,414 32,807 42,675 35,605 10,782 15,0316,119 17,034 14,373 14,053 54,696 61,994 60,755 60,385 54,344 54,251 3,492 5,8878,519,628 10,152 9,041 1,151 2,159 437 267 6,603 226 2,581 72,804 88,29788,674 94,890 88,229 86,275 112,166 133,625 133,088 127,697130,904 121,880 8,542 8,409 4,135 10,717 13,9910,501 10,676 13,2512,836 569 1,144 3,292 7,579 7,275 7,413 6,922 6,900 6,624 534 239 266 2,037 24,560 32,209 30,760 23,491 30,723 23,824 21,645 22,085 25,667 20,677 19,292 23,634 3,680 7,2747,927 5,2856,244 1,8802,4562,343 2,121 6,395 7,583 1,865 37,415 39,881 43,098 38,769 34,081 37,579 61,975 72,090 73,85862,260 64,804 61,403 9,950 (84) 1,552 (5,800 2,823) 17 9,269 9,269 9,950 9,403 25,56620,30920,575 20,808 20,19819,056 14,974 23,552 30,40329,777 31,647 30,531 1,062(1,881) 42,127 56,685 55,19861,08462430 56,690 1,6545,107 3,372 parent 3.787 50,191,5559,230 65,437 66,100 60,477 112,166 133,625133,088 127,697 130,904 121,880 8,0644850 3,670 Total equity Total liabilities and equity Consolidated statements of operations in millions of USD Year ended December 31 2006 2007 2008 2009 2010 2011 Sales Cost of sales Gross margin 58,870 105,216 124,936 61,021 78,025 93,973 48,41184,953 106,110 58,815 71,084 85,519 10,459 20,263 18,826 2,206 694 8,454 2,9605,4336,590 3,676 3,336 3,556 7,499 14,830 12,236 (1,470) 3,605 4,898 Selling, general and administrative Operating income Other income-net Income from investments in associates and joint ventures Financing costs - net Income before taxes Incame tax expense Net income from continuing operations (including non-controlling interest) Discontinued operations, net of tax Net income (including non-controlling interest)6,086 Net income attributable to: 49 301 620 (664)(927(2.352 2847)(2.200) 2,838 7,195| 14.888| 11,537| (4,261)| 1,856| 2680 1,109 3,038098(4,432) (1,479) 882 171 3,335 1,798 985 1,653 56 451 6,086 11,850 10,439 (57) (330) 461 11850 10,439 114 3,0052,259 Equity holders of the parent Minority interest 5,226 10,3689,399 860 1,482 1,040 6,086 11,85010,439 157 2,916 2,263 (43) 89 Net income (including non-controlling interest) 114 3,005 2,259