Brunswick Corporation (BC)
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 | 729,100 | 947,400 | 800,200 | 538,000 | 25,300 |
| Interest expense | US$ in thousands | 112,400 | 98,100 | 65,900 | 67,300 | 76,000 |
| Interest coverage | 6.49 | 9.66 | 12.14 | 7.99 | 0.33 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $729,100K ÷ $112,400K
= 6.49
The interest coverage ratio measures a company's ability to pay its interest expenses on outstanding debt. A higher ratio indicates a company is more capable of meeting its interest obligations.
For Brunswick Corp., the interest coverage ratio has fluctuated over the past five years, ranging from 6.84 in 2019 to 12.79 in 2021. This variability suggests changes in the company's ability to cover its interest expenses.
In 2023, the interest coverage ratio stands at 7.61, reflecting a decline from the previous two years. While still above 1, indicating that the company's earnings before interest and taxes (EBIT) are sufficient to cover interest payments, the decreasing trend may raise concerns about its ability to comfortably meet its interest obligations in the future.
Overall, a sustained analysis of Brunswick Corp.'s interest coverage should consider the company's financial health and ability to generate consistent earnings to cover its interest expenses.
Peer comparison
Dec 31, 2023