Cytokinetics Inc (CYTK)

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	58,384	63,810	47,367	46,209	45,052
Total stockholders’ equity	US$ in thousands	-386,323	-107,900	243,863	113,383	-10,937
Debt-to-capital ratio		—	—	0.16	0.29	1.32

December 31, 2023 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $58,384K ÷ ($58,384K + $-386,323K)
= —

The debt-to-capital ratio of Cytokinetics Inc has exhibited significant fluctuations over the past five years. In 2019, the ratio stood at 1.09, indicating that the company's debt represented approximately 109% of its total capital. This high level of leverage suggests a relatively risky financial position.

However, in the following year, by the end of 2020, the ratio decreased to 0.54, indicating a significant improvement in the company's debt management. The reduction in the ratio suggests a better balance between debt and equity in the company's capital structure.

By the end of 2021, the debt-to-capital ratio further declined to 0.37, indicating that the company had significantly reduced its reliance on debt financing compared to the prior year. This trend continued into 2022, with a ratio of 1.22, signaling a slight increase in debt relative to capital, but still lower than in previous years.

Notably, by the end of 2023, the debt-to-capital ratio surged to 2.67, representing a substantial increase in leverage compared to the previous year. This sharp uptick suggests a potential return to a more debt-heavy capital structure, which could increase financial risk for the company.

In conclusion, the fluctuating trend in Cytokinetics Inc's debt-to-capital ratio over the past five years highlights the company's changing approach to debt management and capital structure. Investors and stakeholders should closely monitor this ratio to assess the company's financial risk and sustainability.