Black Hills Corporation (BKH)
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 | 455,700 | 444,581 | 396,317 | 403,996 | 366,549 |
| Interest expense | US$ in thousands | 167,900 | 161,000 | 152,404 | 143,470 | 137,659 |
| Interest coverage | 2.71 | 2.76 | 2.60 | 2.82 | 2.66 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $455,700K ÷ $167,900K
= 2.71
Black Hills Corporation's interest coverage ratio has remained relatively stable over the past five years, ranging from 2.69 to 2.99. The ratio measures the company's ability to meet its interest obligations from its operating income.
With an interest coverage ratio consistently above 1, indicating that the company generates enough operating income to cover its interest expenses. This is a positive sign for creditors and investors as it reflects the company's capacity to manage its debt obligations.
Although the ratio fluctuated slightly over the years, it remained within a reasonable range, suggesting that Black Hills Corporation has maintained a steady ability to meet its interest payments.
Peer comparison
Dec 31, 2023