Abercrombie & Fitch Company (ANF)

Debt-to-capital ratio

		Feb 3, 2024	Jan 28, 2023	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020
Long-term debt	US$ in thousands	222,119	296,852	303,574	343,910	231,963
Total stockholders’ equity	US$ in thousands	1,035,160	694,841	826,090	936,628	1,058,810
Debt-to-capital ratio		0.18	0.30	0.27	0.27	0.18

February 3, 2024 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $222,119K ÷ ($222,119K + $1,035,160K)
= 0.18

The debt-to-capital ratio for Abercrombie & Fitch Company has fluctuated over the past five years. As of February 3, 2024, the ratio stands at 0.18, indicating that the company's total debt represents 18% of its total capital (debt + equity). This suggests a conservative financial structure with a lower reliance on debt financing.

Comparing this to the ratios from previous years, we observe a decrease from 0.30 in January 2023 to the current 0.18 in February 2024. This signifies a significant reduction in the proportion of debt relative to total capital within just one year, potentially reflecting efforts by the company to pay down debt or increase equity.

In the preceding years, the debt-to-capital ratio remained relatively stable around the 0.27 mark, with the exception of February 1, 2020, when it matched the current ratio of 0.18. This implies a period of more consistent debt-to-capital levels before the recent notable decline.

Overall, the decreasing trend in Abercrombie & Fitch's debt-to-capital ratio indicates a positive shift towards a stronger balance sheet with less leverage, which may enhance the company's financial stability and flexibility in the long term.