Benchmark Electronics Inc (BHE)

Interest coverage

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	110,817	113,095	97,236	53,879	25,657
Interest expense	US$ in thousands	26,922	31,875	12,894	8,472	8,364
Interest coverage		4.12	3.55	7.54	6.36	3.07

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $110,817K ÷ $26,922K
= 4.12

Interest coverage is a financial ratio that indicates a company's ability to pay interest expenses on outstanding debt. A higher interest coverage ratio suggests that the company is more capable of meeting its interest obligations.

Based on the data provided for Benchmark Electronics Inc, the interest coverage ratio has shown fluctuations over the years. In December 2020, the interest coverage ratio was 3.07, indicating the company's operating income covered its interest expenses 3.07 times.

By December 2021, the interest coverage ratio improved to 6.36, suggesting a stronger ability to cover interest payments. The ratio further increased to 7.54 by December 2022, reflecting improved financial health and a more comfortable position to meet interest obligations.

However, there was a decrease in the interest coverage ratio to 3.55 by December 2023, indicating a potential decrease in the company's ability to cover interest expenses adequately. The ratio recovered slightly to 4.12 by December 2024, but it remained below the levels seen in 2022.

Overall, while Benchmark Electronics Inc has shown some fluctuations in its interest coverage ratio, the company generally demonstrated the ability to cover its interest expenses adequately, with some fluctuations in its financial health over the years.