International Flavors & Fragrances Inc (IFF)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 30,978,000 | 35,522,000 | 39,658,000 | 13,555,000 | 13,287,400 |
| Total stockholders’ equity | US$ in thousands | 14,611,000 | 17,655,000 | 21,082,000 | 6,310,000 | 6,217,300 |
| Financial leverage ratio | 2.12 | 2.01 | 1.88 | 2.15 | 2.14 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $30,978,000K ÷ $14,611,000K
= 2.12
The financial leverage ratio of International Flavors & Fragrances Inc. has fluctuated over the past five years, ranging from 1.88 to 2.15. The ratio indicates the proportion of the company's debt to its equity, reflecting its reliance on debt financing. A higher ratio suggests a greater level of debt compared to equity, which can increase financial risk but also potentially boost returns through leverage.
In 2023, the financial leverage ratio increased to 2.12 from 2.00 in 2022. This indicates that the company's reliance on debt financing relative to equity slightly increased during the year. It is important for investors and analysts to monitor changes in the financial leverage ratio over time to assess the company's capital structure and financial risk.
Despite the fluctuations in the ratio, International Flavors & Fragrances Inc. has maintained a relatively consistent level of financial leverage over the past five years, with the ratio hovering around 2. This suggests that the company may have a strategic balance between debt and equity financing, leveraging debt to support growth while managing its financial risk effectively.
Peer comparison
Dec 31, 2023