World Kinect Corporation (WKC)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 7,375,300 | 8,164,600 | 5,942,400 | 4,500,300 | 5,992,400 |
| Total stockholders’ equity | US$ in thousands | 1,943,000 | 1,984,900 | 1,912,700 | 1,909,300 | 1,890,400 |
| Financial leverage ratio | 3.80 | 4.11 | 3.11 | 2.36 | 3.17 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $7,375,300K ÷ $1,943,000K
= 3.80
The financial leverage ratio of World Kinect Corp has fluctuated over the past five years, ranging from 2.36 to 4.11. This ratio measures the extent to which the company relies on debt financing as opposed to equity financing. A higher financial leverage ratio indicates a higher level of debt in the company's capital structure.
In 2023, the financial leverage ratio stood at 3.80, reflecting a slight decrease from the previous year's ratio of 4.11. This could suggest that the company has reduced its reliance on debt financing relative to equity financing. However, it is still higher than the ratios observed in 2021 and 2019.
The highest financial leverage ratio of 4.11 was observed in 2022, indicating a relatively high level of debt in the company's capital structure during that year. On the other hand, the lowest ratio of 2.36 in 2020 suggests a lower level of debt compared to the other years.
Overall, World Kinect Corp's financial leverage ratios have shown fluctuations over the years, indicating varying levels of debt usage in the company's financial strategy. A detailed analysis of the company's debt management policies and their impact on financial performance would be beneficial for a more comprehensive understanding of its financial leverage.