Civitas Resources Inc (CIVI)

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	4,785,730	393,293	491,710	0	80,000
Total stockholders’ equity	US$ in thousands	6,181,320	5,373,920	4,655,000	1,045,250	936,690
Debt-to-capital ratio		0.44	0.07	0.10	0.00	0.08

December 31, 2023 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $4,785,730K ÷ ($4,785,730K + $6,181,320K)
= 0.44

The debt-to-capital ratio of Civitas Resources Inc has shown fluctuations over the past five years. In 2023, the ratio stood at 0.44, indicating that debt accounted for 44% of the company's total capital structure. This represents a significant increase from the previous year, where the ratio was 0.07. In 2021 and 2019, the ratio was 0.10 and 0.08 respectively, suggesting that the company had a moderate level of debt relative to its total capital.

The significant increase in the debt-to-capital ratio from 2022 to 2023 may imply that Civitas Resources Inc has taken on more debt to finance its operations or growth initiatives. This could potentially signify increased financial leverage and higher risk, as a higher debt-to-capital ratio indicates a greater reliance on debt financing.

It is important for stakeholders to monitor the company's debt-to-capital ratio over time to assess its ability to meet financial obligations and manage debt levels effectively. A higher ratio may indicate increased financial risk, while a lower ratio may suggest a more conservative capital structure.