Gentherm Inc (THRM)

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	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Long-term debt	US$ in thousands	222,217	207,302	217,441	232,558	232,653	232,000	35,000	36,250	36,250	37,500	45,794	59,319	189,934	193,061	198,099	231,667	78,124	97,123	104,393	97,604
Total assets	US$ in thousands	1,234,370	1,225,600	1,244,050	1,268,750	1,239,300	1,241,330	947,046	967,113	935,343	943,978	933,873	932,454	1,022,840	921,447	823,370	893,370	738,832	737,671	751,910	763,046
Debt-to-assets ratio		0.18	0.17	0.17	0.18	0.19	0.19	0.04	0.04	0.04	0.04	0.05	0.06	0.19	0.21	0.24	0.26	0.11	0.13	0.14	0.13

December 31, 2023 calculation

Debt-to-assets ratio = Long-term debt ÷ Total assets
= $222,217K ÷ $1,234,370K
= 0.18

The debt-to-assets ratio of Gentherm Inc has been relatively stable over the past eight quarters, fluctuating between 0.04 and 0.19. In the most recent quarter, Q4 2023, the ratio stands at 0.18, indicating that 18% of the company's assets are financed by debt.

A lower debt-to-assets ratio is generally considered favorable as it suggests a lower level of financial risk and reliance on debt financing. Gentherm Inc's ratio has been below 0.2 in all quarters, which implies a conservative capital structure and good financial health.

It is noteworthy that there was a significant increase in the ratio from Q2 2022 to Q3 2022, where it jumped from 0.04 to 0.19. This sharp increase might have been driven by a specific event or financial decision during that period. However, the company managed to bring the ratio back down to more typical levels in subsequent quarters.

Overall, the consistent and relatively low debt-to-assets ratio of Gentherm Inc indicates a prudent approach to financing and suggests a solid financial position with a lower risk of financial distress.