Accenture PLC (NYSE:ACN)

Debt to Equity

The debt to equity ratio remains negligible from 2019 through 2022, registering zero, then shows a slight increase in 2023 and 2024 to 0.01 and 0.04 respectively, indicating a minimal but rising use of debt relative to equity.

Debt to Equity (Including Operating Lease Liability)

When including operating lease liabilities, the ratio starts at 0 in 2019, peaks at 0.21 in 2020, and then gradually declines over the following years to 0.15 in 2024. This suggests a decrease in total liabilities relative to equity after 2020, with some stabilization from 2022 onward.

Debt to Capital

Similar to the debt to equity ratio, debt to capital remains at zero through 2022 before a slight uptick to 0.01 and 0.03 in 2023 and 2024, reflecting very limited leverage in capital structure.

Debt to Capital (Including Operating Lease Liability)

This measure follows a similar trend to debt to equity including operating leases, starting from zero in 2019, peaking around 0.17 in 2020, then gradually decreasing year over year to 0.13 by 2024. This points to a reduction in lease and other liabilities as a component of capital over time.

Debt to Assets

Debt to assets remains at zero through 2023, with a slight rise to 0.02 in 2024, indicating minimal debt in relation to total assets until the most recent year where some debt appears on the balance sheet.

Debt to Assets (Including Operating Lease Liability)

This ratio begins at zero in 2019, rises to 0.09 in 2020, and steadily declines each year to 0.07 in 2024, reflecting a gradual decrease in the proportion of liabilities tied to assets when operating lease liabilities are included.

Financial Leverage

Financial leverage rose slightly from 2.07 in 2019 to 2.21 in 2021, indicating increased use of debt or liabilities relative to equity. However, it decreases to 1.98 by 2024, suggesting a slight reduction in reliance on leverage over the most recent years.

Interest Coverage

Interest coverage shows a significant decline from an exceptionally high 273.26 in 2019 to 131.46 in 2021, indicating a reduced ability to cover interest expenses despite still being very high. This metric rebounds somewhat in 2022 and 2023 (195.34 and 193.31), before decreasing again to 165.48 in 2024, reflecting some fluctuation but maintaining a strong capacity to meet interest obligations.

Fixed Charge Coverage

Fixed charge coverage remains relatively stable, fluctuating moderately from 10.07 in 2019 to 13.46 in 2024. This indicates consistent ability to cover fixed charges such as lease payments and interest, with a slight improving trend toward the later years.

Overall, the data indicates very low levels of traditional debt financing across the observed years, with operating lease liabilities contributing more significantly to leverage measures. There is a trend of declining lease-related liabilities as a proportion of equity, capital, and assets after 2020, and a stable to slightly improving ability to cover both interest and fixed charges, reflecting a conservative financial structure with strong coverage metrics throughout the period.

Total Debt

The total debt exhibited a fluctuating trend over the observed period. Initially, it increased substantially from 22,658 thousand US dollars in 2019 to 61,872 thousand US dollars in 2020 and further to 65,553 thousand US dollars in 2021. Subsequently, there was a decline to 55,068 thousand US dollars in 2022. However, debt sharply increased thereafter, reaching 147,903 thousand US dollars in 2023 and dramatically escalating to 1,024,857 thousand US dollars by 2024.

Total Shareholders’ Equity

Shareholders' equity showed consistent growth throughout the period. Starting at 14,409,008 thousand US dollars in 2019, equity expanded steadily each year to reach 17,000,536 thousand US dollars in 2020, 19,529,454 thousand US dollars in 2021, and 22,106,097 thousand US dollars in 2022. This upward trajectory continued with equity rising to 25,692,839 thousand US dollars in 2023 and further to 28,288,646 thousand US dollars in 2024.

Debt to Equity Ratio

The debt to equity ratio remained negligible and virtually constant from 2019 through 2022, with values effectively at zero. A slight increase was observed in 2023, with the ratio rising to 0.01, followed by a more noticeable increase to 0.04 in 2024. Despite this increase, the ratio remains relatively low, indicating a conservative leverage position relative to equity.

Total debt (including operating lease liability)

The total debt shows a sharp increase from approximately $22.7 million in 2019 to about $3.49 billion in 2020. Following this surge, the debt level remains relatively stable but with a slight downward trend until 2023, where it decreases from around $3.50 billion to approximately $3.15 billion. However, in 2024, there is a significant increase to roughly $4.12 billion, the highest level in the observed period.

Total Accenture plc shareholders’ equity

Shareholders’ equity exhibits a consistent upward trend throughout the period. Starting at about $14.41 billion in 2019, it steadily increases every year, reaching around $28.29 billion in 2024. This continuous growth reflects a strengthening equity base, which more than doubled over the six-year span.

Debt to equity (including operating lease liability)

The debt-to-equity ratio is at zero in 2019, likely due to the very low debt level relative to equity. It then sharply rises to 0.21 in 2020, indicating a marked increase in leverage. Subsequently, the ratio declines gradually to 0.12 by 2023, reflecting either a reduction in debt relative to equity or a more rapid increase in equity compared to debt. In 2024, the ratio increases again to 0.15, suggesting a moderate rise in financial leverage.

The financial data reveals significant trends in the company’s capital structure over the analyzed period from August 31, 2019 to August 31, 2024. The total debt shows a marked increase, rising from 22,658 thousand US dollars in 2019 to 1,024,857 thousand US dollars in 2024. This represents a considerable escalation in debt levels, especially noticeable between 2023 and 2024.

Simultaneously, total capital exhibits a steady upward trajectory, increasing from 14,431,666 thousand US dollars in 2019 to 29,313,503 thousand US dollars in 2024. This consistent growth in capital indicates an expanding financial base, possibly driven by retained earnings, equity issuance, or other forms of capital accumulation.

Despite the sharp rise in total debt, the ratio of debt to capital remains very low throughout the period. Starting at zero from 2019 through 2022, it shows a slight increase to 0.01 in 2023 and to 0.03 in 2024. This suggests that even with the increase in debt, the overall capital structure is not heavily leveraged, maintaining a conservative financial risk profile relative to the company’s capital base.

Total Debt Trend

Total debt remained relatively low and stable from 2019 through 2022 but escalated sharply in 2023 and exploded in 2024, indicating increased borrowing or liability accumulation.

Total Capital Trend

Total capital demonstrated continuous growth over the six-year period, nearly doubling from 2019 to 2024, reflecting increased financial resources.

Debt to Capital Ratio

The debt to capital ratio was negligible for most of the period, only rising slightly in the last two years, which signifies a low leverage position despite the higher debt levels.

Total Debt (including operating lease liability)

The total debt experienced a significant increase from 22,658 thousand US dollars in 2019 to over 3.48 million thousand US dollars in 2020. There was a slight increase in 2021 to approximately 3.51 million thousand US dollars, followed by a gradual decline over the next two years, reaching 3.15 million thousand US dollars in 2023. However, in 2024 the total debt rose sharply again to about 4.12 million thousand US dollars, marking the highest value in the period analyzed.

Total Capital (including operating lease liability)

Total capital showed a consistent upward trend throughout the entire period. Starting at approximately 14.43 million thousand US dollars in 2019, total capital increased steadily each year to reach about 32.41 million thousand US dollars in 2024. This represents more than a doubling of total capital over the six-year period, indicating continuous growth in the company's capital base.

Debt to Capital Ratio (including operating lease liability)

The debt to capital ratio began at zero in 2019, suggesting negligible debt relative to capital at that time. It then increased to 0.17 in 2020, before gradually decreasing each subsequent year to 0.11 by 2023. In 2024, the ratio reversed this downward trend slightly, rising to 0.13. Overall, the ratio indicates a relatively low and stable leverage level, with debt representing between 11% and 17% of total capital during the observed period.

Total Debt

The total debt has exhibited a substantial upward trend over the examined periods. Starting at 22,658 thousand US dollars in 2019, the debt increased noticeably to 61,872 thousand in 2020, followed by a moderate rise to 65,553 thousand in 2021. There was a slight decline in 2022 to 55,068 thousand, before surging significantly to 147,903 thousand in 2023 and reaching a peak of 1,024,857 thousand in 2024. This rapid increase in the last two years suggests a significant change in financing or capital structure strategy.

Total Assets

Total assets have shown consistent growth throughout the same period. The value increased from 29,789,880 thousand US dollars in 2019 to 37,078,593 thousand in 2020, continuing steadily to 43,175,843 thousand in 2021, 47,263,390 thousand in 2022, 51,245,305 thousand in 2023, and reaching 55,932,363 thousand in 2024. This steady expansion indicates ongoing asset accumulation or business growth.

Debt to Assets Ratio

The debt to assets ratio remained essentially negligible at zero for the first five years, despite the changes in total debt and total assets. However, in 2024, the ratio increased slightly to 0.02, reflecting the dramatic increase in total debt relative to assets. Although the ratio remains low, this increase marks a departure from prior periods' near-zero debt levels.

Total Debt (Including Operating Lease Liability)

The total debt experienced a significant increase from 2019 to 2020, rising sharply from approximately 22.7 million to about 3.49 billion US dollars. Following this substantial jump, debt levels remained relatively stable with a slight decrease over the next three years ending in 2023. However, in 2024, total debt rose again noticeably to over 4.12 billion US dollars, indicating a renewed accumulation of debt.

Total Assets

Total assets demonstrated a consistent upward trend throughout the observed period. Starting at nearly 29.8 billion US dollars in 2019, assets increased steadily each year, reaching approximately 55.9 billion US dollars by 2024. This strong asset growth suggests ongoing expansion or accumulation of resources over time.

Debt to Assets Ratio (Including Operating Lease Liability)

The debt to assets ratio started at zero in 2019, reflecting minimal or no debt relative to assets at that time. The ratio then increased to 0.09 in 2020, aligning with the substantial increase in total debt during that year. Afterward, the ratio declined gradually over the subsequent years, decreasing to 0.06 in 2023. In 2024, the ratio increased slightly to 0.07, consistent with the increase in total debt noted for that year. Overall, while debt rose substantially in nominal terms, the ratio indicates that debt levels relative to assets have remained relatively low and stable, fluctuating within a range of approximately 6% to 9%.

Total Assets

Total assets have demonstrated a consistent upward trend over the six-year period. Starting from approximately 29.79 billion USD in 2019, the asset base expanded steadily each year, reaching about 55.93 billion USD by 2024. This growth indicates ongoing investment and asset accumulation, suggesting an expansion strategy or increased operational scale.

Total Shareholders’ Equity

Shareholders’ equity has also shown a continuous increase from around 14.41 billion USD in 2019 to approximately 28.29 billion USD in 2024. The growth in equity reflects retained earnings and possibly additional capital injections, contributing to the strengthening of the financial foundation of the entity. The acceleration in equity growth in later years aligns with the asset growth trend.

Financial Leverage

The financial leverage ratio exhibited a gradual increase from 2.07 in 2019 to a peak of 2.21 in 2021, followed by a decline to 1.98 in 2024. This pattern suggests a moderate rise in the proportion of assets financed by debt relative to equity in the initial years, with a subsequent move towards reducing leverage in the later years. The reduction in leverage after 2021 may indicate a strategic effort to strengthen the equity base or reduce reliance on external financing, improving financial stability.

Earnings before interest and tax (EBIT)

The EBIT shows a consistent upward trend from 2019 to 2024, increasing from approximately 6.27 billion USD in 2019 to about 9.76 billion USD in 2024. Notable growth occurred particularly between 2020 and 2022, with EBIT reaching its peak in 2024. There was a slight decline in 2023 compared to 2022 but the figure rebounded sharply in 2024.

Interest expense

Interest expense demonstrated an overall increasing pattern, starting at roughly 22.96 million USD in 2019 and reaching close to 58.97 million USD in 2024. Despite fluctuations, particularly an increase from 2020 to 2021 and again in 2024, interest expenses have generally risen over the period.

Interest coverage ratio

The interest coverage ratio exhibits a declining trend across the years, moving from a high of 273.26 in 2019 down to 165.48 in 2024. This decrease indicates a reduced ability to cover interest expenses from EBIT, although the ratio remains relatively strong.

Overall Insights

While EBIT has grown substantially, indicating improved operating profitability, the rising interest expense has contributed to a declining interest coverage ratio. The company continues to generate earnings well above interest costs, but the margin of coverage is decreasing, suggesting potential attention needed to manage debt levels or interest obligations.

Earnings before fixed charges and tax

There is a consistent upward trend observed from 2019 through 2024. The earnings increased steadily from approximately 6.94 million USD in 2019 to about 10.48 million USD in 2024. Notably, the most significant growth occurred between 2021 and 2022, followed by a relatively stable increase in the subsequent years.

Fixed charges

Fixed charges showed a general increase from 2019 to 2023, rising from around 689 thousand USD in 2019 to a peak of approximately 916 thousand USD in 2023. However, in 2024, there was a decrease to approximately 778 thousand USD. This indicates some variability in fixed costs, with an overall upward movement until 2023 before a decline in the last reported year.

Fixed charge coverage ratio

The fixed charge coverage ratio remained relatively strong throughout the period, ranging from a low of 9.66 in 2020 to a high of 13.46 in 2024. After a slight dip in 2020, the ratio improved significantly in 2021 and peaked in 2022. Although it decreased somewhat in 2023, it rebounded to its highest level in 2024, reflecting an improving ability to cover fixed charges from earnings before fixed charges and tax.