Darling Ingredients Inc (DAR)
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 | 949,726 | 1,040,124 | 1,130,086 | 1,052,014 | 1,029,068 | 990,880 | 928,212 | 917,858 | 884,470 | 747,796 | 669,588 | 507,618 | 430,936 | 649,859 | 582,263 | 550,099 | 475,821 | 256,272 | 211,969 | 174,599 |
| Interest expense (ttm) | US$ in thousands | 376,577 | 244,042 | 243,851 | 174,734 | 125,566 | 62,585 | 62,237 | 62,168 | 62,077 | 71,488 | 71,898 | 72,310 | 72,686 | 78,481 | 78,499 | 78,516 | 78,674 | 84,599 | 84,775 | 64,879 |
| Interest coverage | 2.52 | 4.26 | 4.63 | 6.02 | 8.20 | 15.83 | 14.91 | 14.76 | 14.25 | 10.46 | 9.31 | 7.02 | 5.93 | 8.28 | 7.42 | 7.01 | 6.05 | 3.03 | 2.50 | 2.69 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $949,726K ÷ $376,577K
= 2.52
The interest coverage ratio for Darling Ingredients Inc has shown fluctuating trends over the past years. The ratio indicates the company's ability to meet its interest obligations based on its operating income.
In the latest period, the interest coverage ratio was 2.52, which suggests that the company generated operating income 2.52 times its interest expense. This reflects a moderate ability to cover interest payments.
Looking at historical data, the interest coverage ratio has varied significantly, with the ratio reaching as high as 15.83 in Sep 2022, indicating a strong ability to cover interest expenses. This trend implies that the company has had periods of robust profitability relative to its interest costs.
However, it is important to note that the ratio has also dipped below 3 in some periods, indicating a concerning level of risk in meeting interest obligations. Overall, Darling Ingredients Inc should strive to maintain a comfortable interest coverage ratio to ensure financial stability and mitigate the risk of defaulting on its debt obligations.
Peer comparison
Dec 31, 2023