Ironwood Pharmaceuticals Inc (IRWD)

Debt-to-assets ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Long-term debt	US$ in thousands	498,309	396,251	337,333	430,256	407,994
Total assets	US$ in thousands	471,073	1,100,520	1,126,930	559,238	402,748
Debt-to-assets ratio		1.06	0.36	0.30	0.77	1.01

December 31, 2023 calculation

Debt-to-assets ratio = Long-term debt ÷ Total assets
= $498,309K ÷ $471,073K
= 1.06

The debt-to-assets ratio of Ironwood Pharmaceuticals Inc has varied over the past five years, indicating changes in the company's capital structure and financial leverage.

In 2019, the ratio was relatively high at 1.01, suggesting that the company had a higher level of debt relative to its total assets. This could indicate greater financial risk and dependency on debt financing.

In 2020, there was a decrease in the ratio to 0.77, which may indicate a reduction in debt levels or an increase in asset values. This could imply improved financial stability and lower risk associated with debt.

However, in 2021, the ratio increased slightly to 0.40, indicating a higher proportion of debt compared to total assets. This could suggest a potential reversion to a more leveraged position or lower asset base.

In 2022, the ratio significantly dropped to 0.36, indicating a lower debt-to-assets ratio and potentially a stronger financial position with more asset coverage for debt obligations.

The most recent data for 2023 shows a significant increase in the debt-to-assets ratio to 1.48, which is the highest among the five years. This suggests a notable surge in debt relative to assets, potentially signaling increased financial risk and leverage.

Overall, fluctuations in Ironwood Pharmaceuticals Inc's debt-to-assets ratio over the years reflect changes in the company's financing decisions, capital structure, and financial health. Analysts should consider these trends along with other financial indicators to assess the company's overall performance and risk profile effectively.