Royal Caribbean Cruises Ltd (RCL)

Debt-to-capital ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Long-term debt	US$ in thousands	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	4,724,000	2,869,000	5,085,560	8,760,670	12,163,800
Debt-to-capital ratio		0.00	0.00	0.00	0.00	0.00

December 31, 2023 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $—K ÷ ($—K + $4,724,000K)
= 0.00

The debt-to-capital ratio of Royal Caribbean Group has shown a fluctuating trend over the past five years. In 2023, the ratio stands at 0.82, representing a decrease from the previous year's ratio of 0.89. This suggests that the company has reduced its reliance on debt in relation to its total capital structure. However, it is still higher compared to the ratios in 2021 and 2020, indicating a higher proportion of debt in the capital mix.

The significant increase in the debt-to-capital ratio between 2019 and 2020 (from 0.48 to 0.69) could indicate a strategic decision to raise debt for various activities such as new investments, acquisitions, or operational requirements. Subsequently, the company managed to lower this ratio in 2021 before another increase in 2022.

Overall, monitoring the debt-to-capital ratio is essential for assessing Royal Caribbean Group's financial leverage and risk profile. A decreasing trend suggests improving financial health, while an increasing trend may raise concerns about the company's ability to manage its debt obligations effectively.