Civitas Resources Inc (CIVI)

Debt-to-assets ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Long-term debt	US$ in thousands	4,785,730	393,293	491,710	0	80,000
Total assets	US$ in thousands	14,097,300	7,971,400	6,741,030	1,182,810	1,206,320
Debt-to-assets ratio		0.34	0.05	0.07	0.00	0.07

December 31, 2023 calculation

Debt-to-assets ratio = Long-term debt ÷ Total assets
= $4,785,730K ÷ $14,097,300K
= 0.34

Civitas Resources Inc's debt-to-assets ratio has exhibited fluctuations over the past five years. In 2023, the ratio increased significantly to 0.34 from 0.05 in 2022, indicating a higher proportion of debt relative to total assets. This could suggest a greater reliance on debt financing that year. Compared to 2021 and 2019 when the ratio was 0.07 and 0.07 respectively, the 2023 ratio indicates a notable departure from historical levels. Furthermore, in 2020, the company reported a debt-to-assets ratio of 0.00, indicating that it had no debt relative to its assets during that period.

The substantial increase in the debt-to-assets ratio from 2022 to 2023 may raise concerns about the company's financial leverage and ability to manage its debt obligations. It is important to assess the reasons behind this increase and to monitor the company's debt management strategies going forward to ensure a sustainable financial position.