Colgate-Palmolive Company (CL)

Financial leverage ratio

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Total assets	US$ in thousands	16,046,000	16,774,000	16,480,000	16,571,000	16,393,000	16,043,000	16,227,000	16,173,000	15,731,000	16,288,000	15,711,000	15,723,000	15,040,000	15,880,000	15,999,000	15,801,000	15,920,000	15,466,000	15,141,000	15,070,000
Total stockholders’ equity	US$ in thousands	212,000	435,000	123,000	230,000	609,000	-9,000	-64,000	-6,000	401,000	622,000	168,000	321,000	609,000	591,000	464,000	262,000	743,000	653,000	268,000	-113,000
Financial leverage ratio		75.69	38.56	133.98	72.05	26.92	—	—	—	39.23	26.19	93.52	48.98	24.70	26.87	34.48	60.31	21.43	23.68	56.50	—

December 31, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $16,046,000K ÷ $212,000K
= 75.69

The financial leverage ratio of Colgate-Palmolive Company has shown fluctuating trends over the period observed. The ratio is a measure of the company's reliance on debt to finance its operations. Higher values of the financial leverage ratio indicate a higher level of debt relative to equity.

In June 2020, the financial leverage ratio was 56.50%, which decreased to 23.68% by September 2020. This significant decrease suggests a reduction in the company's leverage and dependency on debt financing during this period. The ratio continued to decrease to 21.43% by December 2020, indicating a conservative approach to capital structure.

However, from March 2021 to June 2022, the financial leverage ratio experienced fluctuations, peaking at 93.52% in June 2022. This substantial increase in leverage suggests a higher reliance on debt to fund operations or investments during this period. Subsequently, the ratio declined to 26.19% by September 2022, indicating a potential adjustment in the company's capital structure.

In March 2024, the financial leverage ratio surged to 72.05% and peaked at 133.98% in June 2024, suggesting a significant increase in leverage and possible higher financial risk. By December 2024, the ratio decreased to 75.69%, indicating a potential adjustment in the company's debt levels.

The financial leverage ratio demonstrates the balance between debt and equity in Colgate-Palmolive's capital structure, highlighting periods of increased leverage and adjustments in the company's financing strategies over the period analyzed. Further analysis of the company's financial position and objectives would be necessary to assess the implications of these leverage fluctuations on its overall financial health and risk profile.