AAR Corp (AIR)
Debt-to-assets ratio
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 985,400 | 269,700 | 98,900 | 133,700 | 600,000 |
| Total assets | US$ in thousands | 2,770,000 | 1,833,100 | 1,573,900 | 1,539,700 | 2,079,000 |
| Debt-to-assets ratio | 0.36 | 0.15 | 0.06 | 0.09 | 0.29 |
May 31, 2024 calculation
Debt-to-assets ratio = Long-term debt ÷ Total assets
= $985,400K ÷ $2,770,000K
= 0.36
The debt-to-assets ratio of AAR Corp has exhibited fluctuations over the past five years. In May 2024, the ratio stood at 0.36, representing an increase from the previous year. This indicates that AAR Corp financed 36% of its assets using debt. The significant increase in the ratio compared to the prior year suggests a higher reliance on debt to fund its operations and investments.
In May 2023, the debt-to-assets ratio was 0.15, reflecting a relatively lower proportion of debt to assets compared to the following year. The company's debt financing comprised 15% of its total assets, indicating a more conservative approach to leverage in that period.
The year 2022 saw a notably low debt-to-assets ratio of 0.06 for AAR Corp. This implies that only 6% of the company's total assets were financed through debt, signaling a conservative capital structure and a strong ability to fund its operations using internal resources.
In May 2021, the debt-to-assets ratio increased to 0.09, indicating a slight uptick in leverage compared to the previous year. The company financed 9% of its assets with debt, suggesting a moderate level of leverage but still maintaining a relatively conservative financial position.
In May 2020, AAR Corp experienced a higher debt-to-assets ratio of 0.29, implying that 29% of its assets were funded through debt. This ratio was higher compared to the preceding year, indicating a notable increase in the company's reliance on debt financing for its operations and investments.
Overall, the fluctuations in AAR Corp's debt-to-assets ratio over the five-year period highlight varying levels of debt utilization and financial risk management strategies employed by the company. The increase in the ratio in the most recent year may warrant further investigation into the reasons behind the higher leverage and its potential impact on the company's financial health and stability.
Peer comparison
May 31, 2024