Leverage Analysis
Examining Iomega's capital structure and financial leverage (1995-2007)
Latest Debt-to-Assets
56.1%
Year 2007
13-Year Average
52.6%
1995-2007
Long-term Debt (2007)
$0
Paid off by 2004
Debt-to-Assets Ratio Over Time
Percentage of assets financed by debt - lower is generally better
Long-term Debt Evolution
Tracking Iomega's long-term debt reduction strategy
Leverage Evolution
How capital structure changed over time
Key Periods:
- •1995: High leverage at 76.5% debt-to-assets, 3.25 debt-to-equity
- •1996-1999: Improved to 48-59% as Zip drive generated cash
- •2000-2002: Best period at 40-48% debt-to-assets
- •2003-2007: Stabilized at 53-56%, minimal long-term debt
Interpretation: Iomega successfully reduced leverage from its risky 1995 levels, paying off all long-term debt by 2004. This conservative approach helped maintain financial stability during the decline phase.
Debt Management Strategy
Conservative financial management in final years
Long-term Debt Elimination:
- •1995: Started with $22.9M long-term debt
- •1996-1997: Peaked at $121-134M during expansion
- •2000: Paid off completely ($0)
- •2004-2007: Maintained zero long-term debt
Strategic Insight: By eliminating long-term debt, Iomega reduced financial risk and preserved flexibility during its transition period. This conservative approach made the company more attractive for acquisition.
Detailed Leverage Data
Complete 13-year capital structure dataset
| Year | Debt-to-Assets | Debt-to-Equity | Equity Ratio | Long-term Debt | Total Liabilities |
|---|---|---|---|---|---|
| 1995 | 76.5% | 3.25 | 23.5% | $22.9M | $157.4M |
| 1996 | 52.0% | 1.09 | 48.0% | $121.0M | $392.4M |
| 1997 | 51.9% | 1.08 | 48.1% | $133.6M | $498.9M |
| 1998 | 49.9% | 1.00 | 50.1% | $46.1M | $415.1M |
| 1999 | 54.4% | 1.19 | 45.6% | $45.5M | $382.4M |
| 2000 | 40.1% | 0.67 | 59.9% | $0.0M | $326.9M |
| 2001 | 47.9% | 0.78 | 61.7% | $3.0M | $294.0M |
| 2002 | 34.5% | 0.53 | 65.5% | $2.2M | $216.6M |
| 2003 | 52.9% | 1.12 | 47.1% | $1.5M | $154.6M |
| 2004 | 56.0% | 1.27 | 44.0% | $0.0M | $127.9M |
| 2005 | 56.1% | 1.28 | 43.9% | $0.0M | $112.7M |
| 2006 | 56.1% | 1.28 | 43.9% | $0.0M | $93.9M |
| 2007 | 56.1% | 1.28 | 43.9% | $0.0M | $93.9M |