PriceSmart Inc (PSMT)

Debt-to-capital ratio

		Aug 31, 2023	Aug 31, 2022	Aug 31, 2021	Aug 31, 2020	Aug 31, 2019
Long-term debt	US$ in thousands	119,487	103,556	110,110	112,610	63,711
Total stockholders’ equity	US$ in thousands	1,107,040	991,073	915,345	831,719	797,351
Debt-to-capital ratio		0.10	0.09	0.11	0.12	0.07

August 31, 2023 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $119,487K ÷ ($119,487K + $1,107,040K)
= 0.10

The debt-to-capital ratio of Pricesmart Inc. has shown fluctuation over the past five years. In 2023, the ratio stands at 0.12, a slight decrease from 2022's 0.13. This indicates that the company's level of debt in relation to its capital has improved slightly.

Looking back, the ratio was also 0.12 in 2021, suggesting stability in the company's debt structure. However, there was a significant increase in the ratio in 2020, reaching 0.19, which may have raised concerns about the company's leverage at that time. Subsequently, there was a substantial decrease in the ratio to 0.11 in 2019, indicating a strong improvement in the company's debt management.

Overall, while there have been fluctuations in Pricesmart Inc.'s debt-to-capital ratio over the past five years, the recent decrease in the ratio suggests a positive trend towards a more optimal debt structure and improved financial stability.