The Clorox Company (CLX)

Debt-to-capital ratio

Jun 30, 2024 Jun 30, 2023 Jun 30, 2022 Jun 30, 2021 Jun 30, 2020
Long-term debt US$ in thousands 2,481,000 2,477,000 2,474,000 2,484,000 2,780,000
Total stockholders’ equity US$ in thousands 328,000 220,000 556,000 411,000 908,000
Debt-to-capital ratio 0.88 0.92 0.82 0.86 0.75

June 30, 2024 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $2,481,000K ÷ ($2,481,000K + $328,000K)
= 0.88

The debt-to-capital ratio of The Clorox Company has shown fluctuation over the past five years. In the most recent fiscal year ending June 30, 2024, the debt-to-capital ratio decreased to 0.88 compared to 0.92 in the previous year. This indicates that the company relied less on debt financing in relation to its total capital structure in 2024.

However, despite this decrease, it is important to note that the ratio remains relatively high, suggesting that a significant portion of Clorox's capital structure is still financed through debt. The trend over the past five years shows some variation, with the ratio peaking in 2023 at 0.92 and hitting its lowest point in 2020 at 0.75.

It is essential for stakeholders to closely monitor the company's debt-to-capital ratio as high levels of debt can indicate higher financial risk and potential issues with debt repayment. Clorox's management may need to assess the optimal capital structure to strike a balance between leveraging debt for growth opportunities and maintaining a healthy financial position.