Valaris Ltd (VAL)
Debt-to-assets ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 1,079,300 | 542,400 | 0 | 5,923,500 | 5,010,400 |
| Total assets | US$ in thousands | 4,322,200 | 2,860,300 | 12,873,200 | 16,931,200 | 14,023,700 |
| Debt-to-assets ratio | 0.25 | 0.19 | 0.00 | 0.35 | 0.36 |
December 31, 2023 calculation
Debt-to-assets ratio = Long-term debt ÷ Total assets
= $1,079,300K ÷ $4,322,200K
= 0.25
The debt-to-assets ratio for Valaris Ltd has shown varying trends over the past three years. As of December 31, 2023, the ratio stands at 0.25, indicating that 25% of the company's assets are financed through debt. This represents an increase from the previous year's ratio of 0.19 (19%), suggesting that Valaris has taken on more debt relative to its total assets.
Comparing this to the ratio from two years ago, which was 0.21 (21%), we can see that the current ratio is higher, indicating a potentially higher level of financial leverage. A higher debt-to-assets ratio can signify increased risk for the company, as it suggests a higher proportion of debt funding in relation to its assets.
It would be important for stakeholders to monitor how Valaris manages its debt levels going forward, as a sustained increase in the debt-to-assets ratio could potentially impact the company's financial stability and solvency. Additionally, it would be essential to assess the company's ability to generate sufficient cash flow to meet its debt obligations and to evaluate the overall risk profile of the business.
Peer comparison
Dec 31, 2023