Planet Fitness Inc (PLNT)
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 | 1,962,870 | 1,978,130 | 1,740,270 | 1,751,430 | 1,687,500 |
| Total assets | US$ in thousands | 2,969,690 | 2,854,590 | 2,015,980 | 1,849,740 | 1,717,190 |
| Debt-to-assets ratio | 0.66 | 0.69 | 0.86 | 0.95 | 0.98 |
December 31, 2023 calculation
Debt-to-assets ratio = Long-term debt ÷ Total assets
= $1,962,870K ÷ $2,969,690K
= 0.66
The debt-to-assets ratio of Planet Fitness Inc has been declining over the past five years, indicating a decreasing reliance on debt to finance its assets. In 2019, the ratio was highest at 0.99, suggesting that nearly the entirety of the company's assets were funded by debt. However, since then, there has been a consistent downward trend, with the ratio dropping to 0.67 by the end of 2023.
This improvement in the debt-to-assets ratio signifies that Planet Fitness Inc has been effectively managing its debt levels in relation to its total assets. A lower ratio indicates a stronger financial position and less financial risk, as there is less debt burden relative to the total assets owned by the company. By reducing its reliance on debt financing, Planet Fitness Inc may have increased its financial stability and flexibility, which could positively impact its overall financial health and ability to withstand economic challenges in the future.