Inter Parfums Inc (IPAR)

Financial leverage ratio

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Total assets	US$ in thousands	1,411,260	1,480,600	1,363,990	1,349,180	1,369,330	1,394,400	1,351,660	1,369,330	1,308,540	1,111,190	1,102,450	1,162,210	1,145,360	1,126,550	1,108,320	1,145,360	890,145	816,181	753,719	781,432
Total stockholders’ equity	US$ in thousands	744,871	778,476	717,077	708,103	699,393	690,309	668,201	658,406	616,782	574,696	569,814	584,559	571,920	585,659	561,319	540,112	535,835	499,460	465,988	462,024
Financial leverage ratio		1.89	1.90	1.90	1.91	1.96	2.02	2.02	2.08	2.12	1.93	1.93	1.99	2.00	1.92	1.97	2.12	1.66	1.63	1.62	1.69

December 31, 2024 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,411,260K ÷ $744,871K
= 1.89

The financial leverage ratio of Inter Parfums Inc has shown fluctuations over the reporting periods, ranging from a low of 1.62 in June 2020 to a high of 2.12 in March 2021. The ratio increased gradually from 1.62 in June 2020 to peak at 2.12 in March 2021, indicating an increase in the company's reliance on debt to finance its operations and assets during that period. Subsequently, the ratio decreased and fluctuated within a narrower range between 1.89 and 2.12 until the end of 2024.

A financial leverage ratio above 1 indicates that the company has more debt than equity in its capital structure. It implies that the company is using more debt to finance its operations and investments, which can magnify returns during good times but also increase financial risk, especially during economic downturns or volatile markets.

The increasing trend in the financial leverage ratio from June 2020 to March 2021 suggests that Inter Parfums Inc may have been aggressively leveraging its capital structure to pursue growth opportunities or acquisitions. However, the subsequent fluctuations in the ratio indicate potential adjustments in the company's financing strategy to manage debt levels and financial risk.

Overall, the financial leverage ratio trend of Inter Parfums Inc highlights the importance of monitoring and managing the balance between debt and equity financing to ensure sustainable and stable financial performance over time.