Chesapeake Energy Corp (CHK)

Debt-to-capital ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Long-term debt	US$ in thousands	2,028,000	3,093,000	2,278,000	0	9,073,000
Total stockholders’ equity	US$ in thousands	10,729,000	9,124,000	5,671,000	-5,341,000	4,364,000
Debt-to-capital ratio		0.16	0.25	0.29	—	0.68

December 31, 2023 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $2,028,000K ÷ ($2,028,000K + $10,729,000K)
= 0.16

The debt-to-capital ratio of Chesapeake Energy Corp has displayed a fluctuating trend over the past five years. In 2023, the ratio stands at 0.16, indicating that the company's debt accounts for 16% of its total capital. This represents a significant improvement compared to 2022, where the ratio was 0.25.

The decreasing trend in the debt-to-capital ratio suggests that Chesapeake Energy Corp has been actively reducing its debt levels relative to its total capital base, which could signal improved financial health and lower financial risk.

However, it is worth noting that in 2019, the company had a notably higher debt-to-capital ratio of 0.68, indicating a higher reliance on debt financing at that time. The significant decrease in the ratio over the years may suggest that the company has been strategically managing its debt levels to enhance its financial position.

Overall, the decreasing trend in Chesapeake Energy Corp's debt-to-capital ratio reflects a positive development in the company's leverage position, showcasing a potential improvement in its financial stability and risk profile.