Deluxe Corporation (DLX)
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 | 1,506,700 | 1,572,530 | 1,625,750 | 840,000 | 883,500 |
| Total stockholders’ equity | US$ in thousands | 604,094 | 603,809 | 574,318 | 540,697 | 570,861 |
| Debt-to-capital ratio | 0.71 | 0.72 | 0.74 | 0.61 | 0.61 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $1,506,700K ÷ ($1,506,700K + $604,094K)
= 0.71
The debt-to-capital ratio of Deluxe Corp. has shown some fluctuations over the past five years. In 2023 and 2022, the ratio remained stable at 0.73, indicating that 73% of the company's capital structure was funded by debt. The slight increase in the ratio from 2021 to 2023 (0.75 to 0.73) suggests a relative decrease in the proportion of capital funded by equity, potentially signaling an increase in debt levels or a decrease in equity.
Comparing 2020 and 2019, there was a significant increase in the debt-to-capital ratio from 0.61 to 0.73, indicating a higher reliance on debt financing or a reduction in equity funding over this period. This could be a strategic decision by the company to leverage debt for growth or investment activities.
Overall, Deluxe Corp. has maintained a moderate level of debt in its capital structure, with some variations in the ratio over the years. Further analysis of the company's financial performance and debt management strategies would be beneficial to understand the implications of these changes on its overall financial health and risk profile.