PriceSmart Inc (PSMT)

Debt-to-assets ratio

		Aug 31, 2024	Aug 31, 2023	Aug 31, 2022	Aug 31, 2021	Aug 31, 2020
Long-term debt	US$ in thousands	94,443	119,487	103,556	110,110	112,610
Total assets	US$ in thousands	2,022,690	2,005,610	1,808,400	1,705,790	1,656,820
Debt-to-assets ratio		0.05	0.06	0.06	0.06	0.07

August 31, 2024 calculation

Debt-to-assets ratio = Long-term debt ÷ Total assets
= $94,443K ÷ $2,022,690K
= 0.05

The debt-to-assets ratio of PriceSmart Inc has exhibited a decreasing trend over the past five years, dropping from 0.07 in 2020 to 0.05 in 2024. This indicates that the company has been reducing its reliance on debt to finance its assets, which can be seen as a positive sign of financial stability and sound management. A lower debt-to-assets ratio suggests that the company has a stronger financial position and may be better positioned to weather economic downturns or unexpected challenges. It also indicates that the company has a greater proportion of assets financed by equity, which can be viewed favorably by investors and creditors. Overall, this trend in the debt-to-assets ratio reflects positively on PriceSmart Inc's financial health and management strategy.