Mercer International Inc (MERC)
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 | 1,609,420 | 1,346,510 | 1,237,540 | 1,186,620 | 1,087,930 |
| Total assets | US$ in thousands | 2,662,580 | 2,725,040 | 2,351,230 | 2,129,130 | 2,065,720 |
| Debt-to-assets ratio | 0.60 | 0.49 | 0.53 | 0.56 | 0.53 |
December 31, 2023 calculation
Debt-to-assets ratio = Long-term debt ÷ Total assets
= $1,609,420K ÷ $2,662,580K
= 0.60
The debt-to-assets ratio of Mercer International Inc. has shown a fluctuating trend over the past five years. In 2023, the ratio increased to 0.61 from 0.50 in 2022. This suggests that the company's reliance on debt to finance its assets has increased in the most recent year. However, comparing it to the ratios of the previous years, it is still higher than the ratios in 2021 (0.53), 2020 (0.56), and 2019 (0.54).
A debt-to-assets ratio of 0.61 indicates that 61% of Mercer International Inc.'s total assets are funded by debt. This level of leverage implies a moderate degree of financial risk for the company. It is essential for investors and stakeholders to closely monitor the company's debt levels to ensure they remain sustainable and in line with the company's overall financial strategy.