Applied Industrial Technologies (AIT)

Financial leverage ratio

		Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019
Total assets	US$ in thousands	2,951,910	2,854,940	2,782,760	2,750,510	2,743,330	2,608,640	2,522,900	2,474,170	2,452,590	2,383,570	2,225,710	2,303,180	2,271,810	2,305,390	2,241,020	2,249,250	2,283,550	2,289,530	2,419,000	2,429,730
Total stockholders’ equity	US$ in thousands	1,688,780	1,669,020	1,608,030	1,536,120	1,458,440	1,380,660	1,295,880	1,221,440	1,149,360	1,098,390	1,021,690	976,570	932,546	934,907	880,707	885,406	843,542	830,560	962,241	927,225
Financial leverage ratio		1.75	1.71	1.73	1.79	1.88	1.89	1.95	2.03	2.13	2.17	2.18	2.36	2.44	2.47	2.54	2.54	2.71	2.76	2.51	2.62

June 30, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,951,910K ÷ $1,688,780K
= 1.75

The financial leverage ratio of Applied Industrial Technologies has shown fluctuating trends over the past few years. The ratio has been gradually increasing from 1.75 in June 2020 to 2.76 in September 2019, indicating a rising level of financial leverage during this period. However, there have been certain periods of slight decreases in the ratio, such as the decrease from 2.18 in March 2022 to 1.95 in December 2022.

The increase in the financial leverage ratio suggests that the company has been relying more on debt to finance its operations and investments. A higher financial leverage ratio means that a greater proportion of the company's assets are financed through debt rather than equity. This can potentially magnify returns to equity investors, but also increase the risk associated with the company's financial structure.

It is important for stakeholders to monitor the financial leverage ratio of Applied Industrial Technologies closely to assess the company's ability to meet its debt obligations and manage its financial risk effectively. fluctuations in the ratio should be analyzed in conjunction with other financial metrics to gain a comprehensive understanding of the company's financial health and stability.