Gates Industrial Corporation plc (GTES)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 7,254,500 | 7,191,600 | 7,533,000 | 7,426,300 | 7,411,300 |
| Total stockholders’ equity | US$ in thousands | 3,220,200 | 3,110,000 | 3,099,700 | 2,805,700 | 2,651,000 |
| Financial leverage ratio | 2.25 | 2.31 | 2.43 | 2.65 | 2.80 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $7,254,500K ÷ $3,220,200K
= 2.25
The financial leverage ratio of Gates Industrial Corporation plc has been declining over the past five years, indicating a trend towards lower leverage. The ratio decreased from 2.80 in 2019 to 2.25 in 2023. This downward trend suggests that the company is relying less on debt to finance its operations and investments, which could lead to decreased financial risk and vulnerability to economic downturns. A lower financial leverage ratio generally indicates a stronger balance sheet and better solvency for the company. However, it's essential to continue monitoring this ratio to ensure that the company maintains an optimal capital structure for its operations and growth plans.
Peer comparison
Dec 31, 2023