Sotera Health Co (SHC)
Debt-to-assets ratio
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 2,223,670 | 2,222,790 | 2,221,990 | 2,222,330 | 1,747,120 | — | — | 1,744,540 | 1,743,530 | — | — | 1,837,580 |
| Total assets | US$ in thousands | 3,130,420 | 3,036,570 | 3,074,870 | 3,414,170 | 3,117,700 | 2,810,630 | 2,839,680 | 2,835,770 | 2,789,500 | 2,742,740 | 2,851,130 | 2,777,000 |
| Debt-to-assets ratio | 0.71 | 0.73 | 0.72 | 0.65 | 0.56 | 0.00 | 0.00 | 0.62 | 0.63 | 0.00 | 0.00 | 0.66 |
December 31, 2023 calculation
Debt-to-assets ratio = Long-term debt ÷ Total assets
= $2,223,670K ÷ $3,130,420K
= 0.71
The debt-to-assets ratio for Sotera Health Co has shown a general increasing trend over the past eight quarters, indicating a higher reliance on debt financing relative to total assets. The ratio increased from 0.63 in Q1 2022 to 0.74 in Q4 2023. This suggests that the company's proportion of debt in relation to its total assets has been gradually rising.
A debt-to-assets ratio of 0.74 in Q4 2023 implies that the company had $0.74 in debt for every $1 of assets. This indicates that a significant portion of the company's assets are funded through debt rather than equity. Investors and creditors typically use this ratio to assess a company's leverage and financial risk.
Sotera Health Co's increasing debt-to-assets ratio could be a cause for concern as it may indicate a heightened financial risk. It may suggest that the company is taking on more debt to fund its operations or expansion, which could lead to higher interest payments and financial strain in the long term. However, further analysis, including comparing this ratio with industry peers and overall market trends, would provide a more comprehensive understanding of the company's debt management strategy.
Peer comparison
Dec 31, 2023