Kontoor Brands Inc (KTB)

Financial leverage ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Total assets	US$ in thousands	1,645,440	1,582,260	1,533,020	1,545,820	1,517,160
Total stockholders’ equity	US$ in thousands	371,913	250,757	148,138	84,641	69,257
Financial leverage ratio		4.42	6.31	10.35	18.26	21.91

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,645,440K ÷ $371,913K
= 4.42

The financial leverage ratio of Kontoor Brands Inc has exhibited a declining trend over the past five years, indicating a decreasing dependence on debt financing. The ratio decreased from 21.91 in 2019 to 4.42 in 2023. This suggests that the company has been reducing its reliance on debt to finance its operations and growth. A lower financial leverage ratio generally indicates a lower financial risk for the company, as it implies a lower level of debt exposure compared to equity. The declining trend in the financial leverage ratio could be a positive sign for investors and creditors as it reflects a more conservative capital structure and potentially improved financial stability for Kontoor Brands Inc.