Jazz Pharmaceuticals PLC (JAZZ)

Debt-to-capital ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Long-term debt	US$ in thousands	5,107,990	5,693,340	6,018,940	1,848,520	1,573,870
Total stockholders’ equity	US$ in thousands	3,737,000	3,085,730	3,965,190	3,659,740	3,110,980
Debt-to-capital ratio		0.58	0.65	0.60	0.34	0.34

December 31, 2023 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $5,107,990K ÷ ($5,107,990K + $3,737,000K)
= 0.58

The debt-to-capital ratio of Jazz Pharmaceuticals plc has shown some fluctuations over the past five years. In 2023, the ratio stands at 0.60, a slight decrease from the previous year's 0.65. This indicates that 60% of the company's capital is financed through debt, while the remaining 40% is financed through equity. The trend in the debt-to-capital ratio has been generally upward since 2020, where it was at 0.36, reaching a peak in 2022 at 0.65 before slightly decreasing in 2023.

A higher debt-to-capital ratio suggests that the company relies more on debt to finance its operations and growth, which can increase financial risk due to interest payments and potential difficulties in debt repayment. In contrast, a lower ratio indicates the company has a larger proportion of equity in its capital structure, which may imply a more conservative approach to financing.

Overall, the debt-to-capital ratio of Jazz Pharmaceuticals plc has been relatively stable in recent years, albeit showing some fluctuations. It is important for investors and analysts to monitor this ratio alongside other financial metrics to assess the company's financial health and risk profile.