Altair Engineering Inc (ALTR)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 18,735 | -23,836 | 11,777 | 13,630 | 9,759 |
| Interest expense | US$ in thousands | 6,116 | 4,377 | 12,065 | 11,598 | 6,371 |
| Interest coverage | 3.06 | -5.45 | 0.98 | 1.18 | 1.53 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $18,735K ÷ $6,116K
= 3.06
Altair Engineering Inc's interest coverage ratio has fluctuated significantly over the past five years, ranging from a low of -5.45 in 2022 to a high of 3.06 in 2023. In 2022, the negative interest coverage ratio indicates that the company's operating income was insufficient to cover its interest expenses, raising concerns about its ability to meet debt obligations. However, the substantial improvement in 2023 to a positive 3.06 suggests a stronger ability to cover interest expenses with operating income. Despite the improvement in 2023, Altair Engineering Inc should monitor its interest coverage ratio closely to ensure it remains at adequate levels to satisfy its debt obligations.
Peer comparison
Dec 31, 2023