Paylocity Holdng (PCTY)

Financial leverage ratio

		Jun 30, 2025	Mar 31, 2025	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Total assets	US$ in thousands	4,389,430	5,167,970	5,293,770	4,024,780	4,245,460	4,953,040	4,492,720	3,646,780	3,695,680	4,193,520	3,937,770	3,095,110	4,809,010	5,079,240	2,588,590	3,811,540	2,414,880	2,663,550	2,850,960	2,004,850
Total stockholders’ equity	US$ in thousands	1,233,750	1,208,740	1,172,140	1,105,910	1,033,060	1,099,410	986,773	892,639	842,863	768,746	677,767	610,846	613,463	565,419	506,693	467,573	476,930	454,609	408,218	386,820
Financial leverage ratio		3.56	4.28	4.52	3.64	4.11	4.51	4.55	4.09	4.38	5.46	5.81	5.07	7.84	8.98	5.11	8.15	5.06	5.86	6.98	5.18

June 30, 2025 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $4,389,430K ÷ $1,233,750K
= 3.56

The financial leverage ratio of Paylocity Holdings demonstrates a fluctuating but generally declining trend over the observed period from September 30, 2020, through June 30, 2025. Initially, the ratio increased from 5.18 in September 2020 to a peak of 8.98 in March 2022, indicating a rise in leverage that could suggest increased reliance on debt financing relative to equity during this period. Following this apex, there is a clear downward trajectory, with the ratio decreasing to 4.11 by June 30, 2024, and further to 3.56 as of June 30, 2025.

This pattern indicates a movement towards reduced financial leverage, which can be interpreted as a strategy of deleveraging or improved financial stability. Such a reduction suggests that the company may have focused on decreasing its debt levels relative to equity, thereby potentially reducing financial risk and interest expense burden. The consistent decline in the leverage ratio over this period signifies a possible emphasis on strengthening the company’s equity base or paying down existing debt, contributing to a more conservative capital structure.

Overall, the observed trend toward lower leverage ratios aligns with an effort for enhanced financial stability and risk management, reflecting a shift toward a more conservative financial profile.