Matthews International Corporation (MATW)
Debt-to-capital ratio
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 769,614 | 786,484 | 795,291 | 759,086 | 807,710 |
| Total stockholders’ equity | US$ in thousands | 437,158 | 525,668 | 487,352 | 636,548 | 610,807 |
| Debt-to-capital ratio | 0.64 | 0.60 | 0.62 | 0.54 | 0.57 |
September 30, 2024 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $769,614K ÷ ($769,614K + $437,158K)
= 0.64
Matthews International Corporation's debt-to-capital ratio has fluctuated over the past five years, ranging from 0.54 in 2021 to 0.64 in 2024. This ratio measures the proportion of the company's total debt to its total capital, which includes both debt and equity.
A higher debt-to-capital ratio indicates a higher reliance on debt financing, potentially increasing financial risk due to higher interest payments and debt obligations. Conversely, a lower ratio suggests a stronger financial position with less dependency on debt.
The increase in the debt-to-capital ratio from 0.54 in 2021 to 0.64 in 2024 could indicate that Matthews International Corporation has been taking on more debt relative to its total capital in recent years. This may be a strategic decision to fund growth opportunities, acquisitions, or capital expenditures.
It is essential for investors and stakeholders to closely monitor changes in the debt-to-capital ratio to assess the company's leverage and financial health. Additionally, comparing this ratio with industry peers and historical trends can provide further insights into Matthews International Corporation's capital structure and overall financial performance.