Eastman Chemical Company (EMN)
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 | 1,294,000 | 1,096,000 | 1,254,000 | 1,880,000 | 968,000 |
| Interest expense | US$ in thousands | 200,000 | 240,000 | 182,000 | 198,000 | 210,000 |
| Interest coverage | 6.47 | 4.57 | 6.89 | 9.49 | 4.61 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $1,294,000K ÷ $200,000K
= 6.47
The interest coverage ratio of Eastman Chemical Company has shown fluctuations over the past five years. The ratio was 4.61 at the end of December 31, 2020, indicating that the company's operating income was able to cover its interest expense approximately 4.61 times.
By the end of December 31, 2021, the interest coverage ratio improved significantly to 9.49, suggesting a stronger ability to meet interest obligations.
In December 31, 2022, the interest coverage ratio decreased to 6.89, which may indicate a slight decrease in the company's ability to cover its interest expenses compared to the previous year.
In December 31, 2023, the interest coverage ratio dropped to 4.57, signaling a potential strain on Eastman Chemical Company's ability to cover its interest payments with operating income.
However, by the end of December 31, 2024, the interest coverage ratio increased to 6.47, showing a recovery from the previous year's decline and a better capacity to meet interest obligations.
Overall, Eastman Chemical Company's interest coverage ratios have been somewhat volatile, with fluctuations indicating varying levels of ability to cover interest expenses with operating income. It would be important for stakeholders to closely monitor these fluctuations to assess the company's financial health and ability to service its debt obligations effectively.
Peer comparison
Dec 31, 2024