Dolby Laboratories (DLB)
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 | 203,700 | 237,435 | 272,005 | 297,573 | 224,252 | 215,794 | 227,817 | 237,665 | 279,332 | 347,417 | 338,718 | 319,320 | 344,535 | 239,640 | 261,524 | 263,396 | 262,647 | 282,119 | 243,597 | 195,930 |
| Interest expense (ttm) | US$ in thousands | 80 | 161 | 300 | 270 | 391 | 394 | 374 | 398 | 478 | 479 | 415 | 341 | 199 | 186 | 195 | 190 | 197 | 170 | 153 | 211 |
| Interest coverage | 2,546.25 | 1,474.75 | 906.68 | 1,102.12 | 573.53 | 547.70 | 609.14 | 597.15 | 584.38 | 725.30 | 816.19 | 936.42 | 1,731.33 | 1,288.39 | 1,341.15 | 1,386.29 | 1,333.23 | 1,659.52 | 1,592.14 | 928.58 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $203,700K ÷ $80K
= 2,546.25
The interest coverage ratio measures the ability of Dolby Laboratories to meet its interest payments on outstanding debt. A higher interest coverage ratio indicates that the company has more earnings to cover its interest expense.
Analyzing Dolby Laboratories' interest coverage over the provided periods, we observe fluctuations in the ratio. The interest coverage ranged from a low of 547.70 in September 2022 to a high of 2,546.25 in December 2023. This indicates variability in the company's ability to cover its interest obligations over time.
It is important to note that a consistently high interest coverage ratio above 2 or 3 is generally considered healthy, as it suggests that the company is comfortably able to meet its interest payments using its earnings. On the other hand, a low or declining interest coverage ratio may indicate financial distress and potential difficulties in servicing debt obligations.
Overall, Dolby Laboratories' interest coverage ratios exhibit variability across the reported periods, suggesting fluctuations in the company's ability to cover its interest expenses with operating earnings. Investors and creditors should closely monitor these ratios to assess the company's financial health and ability to manage its debt obligations effectively.
Peer comparison
Dec 31, 2023