Acuity Brands Inc (AYI)
Debt-to-capital ratio
| Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | Aug 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 495,600 | 495,000 | 494,300 | 376,800 | 347,500 |
| Total stockholders’ equity | US$ in thousands | 2,015,400 | 1,911,800 | 2,044,500 | 2,127,500 | 1,918,900 |
| Debt-to-capital ratio | 0.20 | 0.21 | 0.19 | 0.15 | 0.15 |
August 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $495,600K ÷ ($495,600K + $2,015,400K)
= 0.20
The debt-to-capital ratio of Acuity Brands, Inc. has shown relatively stable levels over the past five years, fluctuating within a narrow range of 0.16 to 0.21. This ratio measures the proportion of the company's capital that is financed by debt and reflects the extent to which the company relies on debt to finance its operations.
The slight increase from 2020 to 2022 indicates a higher reliance on debt financing, but the ratio remained below 0.22, suggesting that the company has kept its debt levels within a manageable range compared to its capital. The decrease in 2023 signifies a slight reduction in the proportion of debt to capital.
Overall, the trend suggests that Acuity Brands, Inc. has maintained a relatively conservative approach to debt financing, which may indicate a lower risk of financial distress and sufficient capacity to meet its debt obligations. However, it's important to consider the industry norms and the company's overall financial health when evaluating the significance of these ratios.
Peer comparison
Aug 31, 2023