Ecolab Inc (ECL)

Financial leverage ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Total assets	US$ in thousands	22,387,800	21,846,600	21,464,300	21,206,400	18,126,000
Total stockholders’ equity	US$ in thousands	8,757,300	8,044,700	7,236,100	7,224,200	6,166,500
Financial leverage ratio		2.56	2.72	2.97	2.94	2.94

December 31, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $22,387,800K ÷ $8,757,300K
= 2.56

The financial leverage ratio of Ecolab Inc has shown a relatively stable trend over the past five years. Starting at 2.94 in December 2020 and maintaining this level in December 2021, the ratio slightly increased to 2.97 by December 2022. However, there was a decline in the financial leverage ratio to 2.72 by December 2023, followed by a further decrease to 2.56 by December 2024.

This indicates that the company's reliance on debt to finance its operations has decreased in the most recent years, as the financial leverage ratio has been trending downward. A lower financial leverage ratio suggests that the company has a lower proportion of debt in its capital structure relative to equity, which may indicate a more conservative approach to financing and potentially lower financial risk. However, it is essential to consider other factors such as the company's industry, market conditions, and future growth prospects when interpreting changes in the financial leverage ratio.