Worthington Industries Inc (WOR)
Debt-to-assets ratio
| May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | May 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 689,718 | 696,345 | 710,031 | 699,516 | 598,356 |
| Total assets | US$ in thousands | 3,650,920 | 3,643,020 | 3,373,240 | 2,331,520 | 2,510,800 |
| Debt-to-assets ratio | 0.19 | 0.19 | 0.21 | 0.30 | 0.24 |
May 31, 2023 calculation
Debt-to-assets ratio = Long-term debt ÷ Total assets
= $689,718K ÷ $3,650,920K
= 0.19
The debt-to-assets ratio measures the proportion of a company's assets that are financed by debt. A lower ratio implies a lower level of financial risk, as it indicates a smaller amount of debt relative to the company's assets.
For Worthington Enterprises Inc., the trend in the debt-to-assets ratio over the past five years shows a decreasing pattern, declining from 0.30 in 2019 to 0.19 in 2023. This suggests that the company has been gradually reducing its reliance on debt to finance its assets, which can be viewed positively by stakeholders concerned about the company's financial stability and risk.
The decrease in the ratio indicates that the company might be utilizing more of its equity to finance its assets, potentially enhancing its financial flexibility and reducing the potential strain from debt obligations. This trend may be viewed favorably by creditors and investors, indicating a potentially stronger financial position and reduced risk of financial distress.
Overall, the decreasing debt-to-assets ratio for Worthington Enterprises Inc. reflects a positive trend in terms of its long-term financial stability and risk management. However, it's important to consider other financial metrics and qualitative factors to gain a comprehensive understanding of the company's financial health.
Peer comparison
May 31, 2023