Commercial Metals Company (CMC)

Debt-to-capital ratio

		Aug 31, 2023	Aug 31, 2022	Aug 31, 2021	Aug 31, 2020	Aug 31, 2019
Long-term debt	US$ in thousands	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	4,120,870	3,286,200	2,294,880	1,889,200	1,623,860
Debt-to-capital ratio		0.00	0.00	0.00	0.00	0.00

August 31, 2023 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $4,120,870K)
= 0.00

The debt-to-capital ratio measures the proportion of a company's capital structure that is financed by debt. Commercial Metals Co.'s debt-to-capital ratio has exhibited a declining trend over the past five years, indicating a reduction in the reliance on debt to fund its operations and finance its assets.

The ratio decreased from 0.43 in 2019 to 0.22 in 2023, signifying a significant improvement in the company's financial leverage and a more conservative approach to capital structure management. This reduction suggests that Commercial Metals Co. has either reduced its debt levels, increased its equity, or a combination of both.

A decreasing trend in the debt-to-capital ratio can be indicative of improved financial stability and reduced financial risk. It may also signal a stronger capacity to meet debt obligations and potential for enhanced financial flexibility in pursuing growth opportunities.

Overall, the declining trend in Commercial Metals Co.'s debt-to-capital ratio reflects a positive shift towards a more balanced and sustainable capital structure, which may potentially strengthen the company's financial position and long-term viability.