Kontoor Brands Inc (KTB)

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	763,921	782,619	791,317	887,957	913,269
Total stockholders’ equity	US$ in thousands	371,913	250,757	148,138	84,641	69,257
Debt-to-capital ratio		0.67	0.76	0.84	0.91	0.93

December 31, 2023 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $763,921K ÷ ($763,921K + $371,913K)
= 0.67

The debt-to-capital ratio of Kontoor Brands Inc has been trending downwards over the past five years, indicating a decreasing reliance on debt to finance its operations and investments relative to its capital structure.

In 2019, the debt-to-capital ratio was the highest at 0.93, signaling that a significant portion of the company's capital was funded by debt. However, this ratio has since decreased steadily to 0.67 by the end of 2023. This downward trend suggests that Kontoor Brands Inc has been reducing its debt levels in relation to its total capital, which could imply improved financial stability and lower financial risk.

A lower debt-to-capital ratio typically indicates lower financial leverage, which can be favorable as it implies less dependency on external financing to support the business. It could also reflect better financial health and a stronger balance sheet position for the company. However, it is essential to consider other financial metrics and factors when evaluating the overall financial health and performance of Kontoor Brands Inc.