Enovis Corp (ENOV)
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 | -26,801 | -18,802 | -88,245 | -423 | 46,884 | 21,656 | 117,582 | 70,940 | 101,095 | -63,511 | -24,899 | -60,368 | -66,182 | 144,497 | 123,515 | -301,427 | -376,466 | -381,026 | -372,267 | 98,189 |
| Interest expense (ttm) | US$ in thousands | 19,749 | 21,604 | 22,170 | 22,640 | 24,052 | 24,305 | 22,093 | 23,236 | 41,832 | 9,648 | 31,093 | 53,688 | 52,824 | 111,330 | 117,591 | 122,478 | 119,503 | 102,448 | 82,231 | 61,996 |
| Interest coverage | -1.36 | -0.87 | -3.98 | -0.02 | 1.95 | 0.89 | 5.32 | 3.05 | 2.42 | -6.58 | -0.80 | -1.12 | -1.25 | 1.30 | 1.05 | -2.46 | -3.15 | -3.72 | -4.53 | 1.58 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-26,801K ÷ $19,749K
= -1.36
The interest coverage ratio for Enovis Corp has been fluctuating over the past eight quarters. In Q1 2022, the company had a relatively healthy interest coverage ratio of 4.51, indicating that Enovis Corp was generating enough earnings to cover its interest expenses 4.51 times over. This positive trend continued into Q2 2022 and Q3 2022, with interest coverage ratios of 3.55 and 2.13, respectively.
However, the situation changed significantly in Q4 2022, where the interest coverage ratio dropped to 3.77, indicating that the company was generating just enough earnings to cover its interest expenses. This downward trend continued into 2023, with interest coverage ratios of -11.90 in Q1 2023, -11.27 in Q2 2023, -11.83 in Q3 2023, and -2.45 in Q4 2023.
The negative interest coverage ratios in 2023 are concerning as they suggest that Enovis Corp's earnings are not sufficient to cover its interest expenses, potentially indicating financial distress. It is important for Enovis Corp to reverse this trend and improve its interest coverage ratio to ensure its long-term financial stability and ability to meet its debt obligations.
Peer comparison
Dec 31, 2023