Benchmark Electronics Inc (BHE)

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	113,095	97,236	53,879	25,657	33,933
Interest expense	US$ in thousands	31,875	12,894	8,472	8,364	6,664
Interest coverage		3.55	7.54	6.36	3.07	5.09

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $113,095K ÷ $31,875K
= 3.55

Benchmark Electronics Inc.'s interest coverage ratio has been fluctuating over the past five years. The ratio decreased from 17.40 in 2019 to 4.61 in 2023. A higher interest coverage ratio indicates that the company is more capable of meeting its interest payment obligations from its operating income. In this case, the company's ability to cover its interest payments declined significantly in 2023 compared to the previous years. It is important for investors and creditors to monitor this ratio closely as a declining trend may indicate potential financial difficulties in meeting interest obligations.