Norwegian Cruise Line Holdings Ltd (NCLH)

Financial leverage ratio

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Total assets	US$ in thousands	19,493,000	19,251,800	18,648,200	18,350,700	18,557,700	18,950,900	19,113,200	19,255,500	18,729,800	18,730,000	18,526,600	18,973,800	18,399,300	17,402,000	17,528,100	16,462,500	16,684,600	15,938,900	15,966,000	15,761,100
Total stockholders’ equity	US$ in thousands	300,807	438,688	15,221	-99,548	68,591	399,783	901,815	1,507,600	2,432,650	2,883,240	3,719,250	4,377,260	4,354,100	4,087,770	4,337,020	4,374,650	6,515,580	6,273,420	6,150,340	5,905,300
Financial leverage ratio		64.80	43.88	1,225.16	—	270.56	47.40	21.19	12.77	7.70	6.50	4.98	4.33	4.23	4.26	4.04	3.76	2.56	2.54	2.60	2.67

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $19,493,000K ÷ $300,807K
= 64.80

The financial leverage ratio of Norwegian Cruise Line Holdings Ltd has shown significant fluctuations over the past eight quarters. In Q1 2023, the ratio was exceptionally high at 1,225.16, indicating a substantial level of financial leverage compared to the company's equity. This sudden spike may be attributed to changes in the company's debt levels or asset values during that period.

Prior to Q1 2023, the company maintained relatively lower financial leverage ratios, with the lowest being 12.77 in Q1 2022, suggesting a more conservative debt-to-equity structure. However, the ratio experienced a sharp increase in Q2 and Q3 2022, reaching 21.19 and 47.40, respectively, which may have signaled a shift towards higher leverage in those quarters.

The recent decrease in Q3 2023 to 43.88 from the previous quarter's peak suggests a potential adjustment in the company's capital structure to reduce leverage. It will be crucial to monitor future trends to understand whether this decline in the financial leverage ratio is sustainable or a temporary fluctuation.

Overall, the fluctuating pattern of Norwegian Cruise Line Holdings Ltd's financial leverage ratio indicates varying degrees of reliance on debt financing over the analyzed period and underscores the importance of closely monitoring the company's capital structure to assess its financial risk and stability.