Arch Resources Inc (ARCH)
Financial leverage ratio
| 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 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 2,484,170 | 2,365,860 | 2,386,900 | 2,432,660 | 2,433,110 | 2,319,860 | 2,313,650 | 2,150,880 | 2,117,160 | 1,930,950 | 1,794,950 | 1,774,160 | 1,722,470 | 1,653,340 | 1,802,390 | 1,857,510 | 1,867,760 | 1,934,600 | 1,889,530 | 1,863,200 |
| Total stockholders’ equity | US$ in thousands | 1,479,460 | 1,396,150 | 1,425,560 | 1,463,990 | 1,365,580 | 1,186,060 | 1,188,710 | 924,252 | 683,866 | 414,643 | 318,529 | 281,443 | 283,561 | 365,646 | 547,782 | 593,764 | 640,536 | 705,436 | 697,950 | 699,947 |
| Financial leverage ratio | 1.68 | 1.69 | 1.67 | 1.66 | 1.78 | 1.96 | 1.95 | 2.33 | 3.10 | 4.66 | 5.64 | 6.30 | 6.07 | 4.52 | 3.29 | 3.13 | 2.92 | 2.74 | 2.71 | 2.66 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $2,484,170K ÷ $1,479,460K
= 1.68
The financial leverage ratio of Arch Resources Inc has shown a fluctuating trend over the past few quarters, ranging from 1.66 to 6.30. The ratio peaked at 6.30 in the first quarter of 2021 before declining to 1.66 in the first quarter of 2023. This indicates that the company's level of debt relative to its equity has varied significantly within the observed period.
In general, a financial leverage ratio above 1 indicates that the company has more debt than equity, suggesting a higher level of financial risk due to increased interest payments and potential financial distress. Arch Resources Inc's ratios above 1.5, particularly in recent quarters, may raise concern about the company's debt levels and its ability to meet financial obligations.
The increasing trend in the financial leverage ratio from the end of 2021 through 2022, reaching a peak at 6.30, indicates a significant increase in debt relative to equity during this period. This sharp increase may have been driven by various factors such as financing activities, acquisitions, or capital investments.
However, the subsequent decline in the financial leverage ratio in the following quarters suggests that the company may have taken steps to reduce its debt levels or improve its equity position. It is crucial for investors and stakeholders to monitor these ratios closely to assess the company's financial health and risk profile, considering the implications of its leverage levels on overall performance and stability.
Peer comparison
Dec 31, 2023