Gentherm Inc (THRM)

Debt-to-capital ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Long-term debt	US$ in thousands	220,064	222,217	232,653	36,250	189,934
Total stockholders’ equity	US$ in thousands	616,947	644,722	672,273	653,806	586,331
Debt-to-capital ratio		0.26	0.26	0.26	0.05	0.24

December 31, 2024 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $220,064K ÷ ($220,064K + $616,947K)
= 0.26

Based on the provided data, the debt-to-capital ratio of Gentherm Inc has fluctuated over the years. As of December 31, 2020, the ratio was 0.24, indicating that debt represented 24% of the company's capital structure.

However, by December 31, 2021, the ratio significantly decreased to 0.05, suggesting a much lower reliance on debt financing compared to the previous year. This could imply that the company either paid off debt or raised more equity during that period.

Subsequently, the ratio increased to 0.26 by December 31, 2022, and remained stable at the same level for 2023 and 2024. This increase indicates a higher proportion of debt in the capital structure compared to 2021, potentially signaling an increased level of leverage within the company.

Overall, fluctuations in the debt-to-capital ratio of Gentherm Inc suggest varying levels of financial leverage and capital structure management over the years, which could impact the company's financial risk and cost of capital. Further analysis of the reasons behind these changes would provide valuable insights into the company's financial strategy and performance.