Collegium Pharmaceutical Inc (COLL)

Interest coverage

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	159,072	105,865	76,792	48,247	34,366	-12,537	-18,863	-13,566	17,640	66,758	72,235	72,386	56,710	39,721	14,211	-7,360	-22,871	-9,880	-15,185	-17,470
Interest expense (ttm)	US$ in thousands	83,339	84,633	82,911	78,809	63,213	47,395	33,464	21,124	21,014	23,994	26,942	29,780	28,882	21,356	13,521	5,498	909	3,102	8,742	14,664
Interest coverage		1.91	1.25	0.93	0.61	0.54	-0.26	-0.56	-0.64	0.84	2.78	2.68	2.43	1.96	1.86	1.05	-1.34	-25.16	-3.19	-1.74	-1.19

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $159,072K ÷ $83,339K
= 1.91

The interest coverage ratio measures a company's ability to cover its interest expenses with its earnings before interest and taxes (EBIT). Collegium Pharmaceutical Inc's interest coverage has been fluctuating over the past eight quarters.

In Q4 2023, the interest coverage ratio improved to 2.47, indicating the company's ability to cover its interest expenses 2.47 times with its EBIT. This can be seen as a positive sign of the company's improved ability to meet its interest obligations.

Compared to the previous quarters, the interest coverage has been steadily increasing since Q1 2023 when it was at its lowest point at 0.91. This signifies a positive trend in the company's financial health and ability to meet its interest payments.

However, it is worth noting that in Q2 and Q3 of 2022, Collegium Pharmaceutical Inc experienced negative interest coverage, indicating that its EBIT was insufficient to cover its interest expenses during those periods.

Overall, the recent improvement in Collegium Pharmaceutical Inc's interest coverage ratio suggests a strengthening financial position and an enhanced ability to meet its interest obligations in the future.