Debt to Equity
since 2005
Calculation
Reynolds American Inc., debt to equity, long-term trends, calculation
| Debt to equity | = | Long-term debt1 | ÷ | Shareholders’ equity1 | |
|---|---|---|---|---|---|
| Dec 31, 2016 | 0.61 | = | 13,165) | ÷ | 21,711) |
| Dec 31, 2015 | 0.96 | = | 17,447) | ÷ | 18,252) |
| Dec 31, 2014 | 1.12 | = | 5,083) | ÷ | 4,522) |
| Dec 31, 2013 | 0.99 | = | 5,099) | ÷ | 5,167) |
| Dec 31, 2012 | 0.97 | = | 5,095) | ÷ | 5,257) |
| Dec 31, 2011 | 0.59 | = | 3,663) | ÷ | 6,251) |
| Dec 31, 2010 | 0.63 | = | 4,101) | ÷ | 6,510) |
| Dec 31, 2009 | 0.68 | = | 4,436) | ÷ | 6,498) |
| Dec 31, 2008 | 0.75 | = | 4,686) | ÷ | 6,237) |
| Dec 31, 2007 | 0.60 | = | 4,515) | ÷ | 7,466) |
| Dec 31, 2006 | 0.67 | = | 4,733) | ÷ | 7,043) |
| Dec 31, 2005 | 0.27 | = | 1,748) | ÷ | 6,553) |
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
1 US$ in millions
- Long-term Debt
- The long-term debt demonstrates significant fluctuations over the analyzed period. Initially, there is a substantial increase from 1,748 million USD in 2005 to 4,733 million USD in 2006, followed by a gradual decline around 4,500 million USD between 2007 and 2011. Notably, there is an abrupt spike to 17,447 million USD in 2015, which subsequently decreases to 13,165 million USD by the end of 2016. This pattern suggests a major increase in leverage or financing activities undertaken in 2015.
- Shareholders’ Equity
- Shareholders’ equity generally trends upward over the period. Starting at 6,553 million USD in 2005, it shows moderate growth until 2007, peaking near 7,466 million USD, before declining to 4,522 million USD in 2014. This decline is sharply reversed in 2015, with equity surging to 18,252 million USD and further increasing to 21,711 million USD in 2016. Such a dramatic rise may indicate significant capital infusion, retained earnings accumulation, or other equity-related transactions.
- Debt to Equity Ratio
- The debt to equity ratio begins at a low of 0.27 in 2005, reflecting conservative leverage. It rises moderately to around 0.75 by 2008, then fluctuates near 0.6 to 1.12 in the following years. The peak ratio of 1.12 in 2014 suggests comparatively higher financial risk or increased debt relative to equity. By 2016, the ratio decreases to 0.61, signaling a reduction in leverage, likely related to the concurrent rises in equity and adjustments in debt levels.
- Overall Observations
- The financial data reveals periods of increased leverage, particularly in 2006 and 2015, aligned with sharp changes in both long-term debt and equity. The sudden spikes in 2015 for both debt and equity indicate significant restructuring or financing events during that year. Equity trends recovering strongly after 2014 demonstrate a strengthening capital base, while the debt to equity ratio's normalization suggests improved financial stability toward the end of the period.
Comparison to Competitors
Reynolds American Inc., debt to equity, long-term trends, comparison to competitors
| Reynolds American Inc. | Coca-Cola Co. | Mondelēz International Inc. | PepsiCo Inc. | Philip Morris International Inc. | |
|---|---|---|---|---|---|
| Dec 31, 2016 | 0.61 | 1.98 | 0.68 | 3.33 | — |
| Dec 31, 2015 | 0.96 | 1.73 | 0.55 | 2.79 | — |
| Dec 31, 2014 | 1.12 | 1.38 | 0.60 | 1.66 | — |
| Dec 31, 2013 | 0.99 | 1.12 | 0.53 | 1.22 | — |
| Dec 31, 2012 | 0.97 | 0.99 | 0.60 | 1.27 | — |
| Dec 31, 2011 | 0.59 | 0.90 | 0.76 | 1.30 | 80.98 |
| Dec 31, 2010 | 0.63 | 0.76 | 0.80 | 1.18 | 4.71 |
| Dec 31, 2009 | 0.68 | 0.48 | 0.73 | 0.47 | 2.70 |
| Dec 31, 2008 | 0.75 | 0.45 | 0.91 | 0.68 | 1.59 |
| Dec 31, 2007 | 0.60 | 0.43 | 0.77 | 0.24 | — |
| Dec 31, 2006 | 0.67 | 0.27 | 0.36 | 0.18 | — |
| Dec 31, 2005 | 0.27 | 0.35 | 0.36 | 0.37 | — |
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Sector (Food, Beverage & Tobacco)
Reynolds American Inc., debt to equity, long-term trends, comparison to sector (food, beverage & tobacco)
| Reynolds American Inc. | Food, Beverage & Tobacco | |
|---|---|---|
| Dec 31, 2016 | 0.61 | 2.76 |
| Dec 31, 2015 | 0.96 | 2.32 |
| Dec 31, 2014 | 1.12 | 1.86 |
| Dec 31, 2013 | 0.99 | 1.36 |
| Dec 31, 2012 | 0.97 | 1.23 |
| Dec 31, 2011 | 0.59 | 1.15 |
| Dec 31, 2010 | 0.63 | 1.02 |
| Dec 31, 2009 | 0.68 | 0.74 |
| Dec 31, 2008 | 0.75 | 0.80 |
| Dec 31, 2007 | 0.60 | 0.52 |
| Dec 31, 2006 | 0.67 | 0.29 |
| Dec 31, 2005 | 0.27 | 0.36 |
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Industry (Consumer Staples)
Reynolds American Inc., debt to equity, long-term trends, comparison to industry (consumer staples)
| Reynolds American Inc. | Consumer Staples | |
|---|---|---|
| Dec 31, 2016 | 0.61 | 1.09 |
| Dec 31, 2015 | 0.96 | 1.00 |
| Dec 31, 2014 | 1.12 | 0.96 |
| Dec 31, 2013 | 0.99 | 0.87 |
| Dec 31, 2012 | 0.97 | 0.83 |
| Dec 31, 2011 | 0.59 | 0.80 |
| Dec 31, 2010 | 0.63 | 0.74 |
| Dec 31, 2009 | 0.68 | 0.69 |
| Dec 31, 2008 | 0.75 | 0.68 |
| Dec 31, 2007 | 0.60 | 0.55 |
| Dec 31, 2006 | 0.67 | 0.52 |
| Dec 31, 2005 | 0.27 | 0.59 |
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).