Fresh Del Monte Produce Inc (FDP)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 30,800 | 143,100 | 102,300 | 75,600 | 113,300 |
| Interest expense | US$ in thousands | 24,100 | 24,400 | 20,300 | 21,400 | 25,400 |
| Interest coverage | 1.28 | 5.86 | 5.04 | 3.53 | 4.46 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $30,800K ÷ $24,100K
= 1.28
Fresh Del Monte Produce Inc's interest coverage ratio has shown fluctuations over the past five years. The ratio was highest in 2022 at 5.86, indicating that the company generated sufficient earnings to cover its interest expenses nearly six times over. However, in 2023, the interest coverage ratio dropped significantly to 1.28, suggesting a decline in the company's ability to cover its interest obligations with its earnings.
The lower interest coverage ratio in 2023 could raise concerns about Fresh Del Monte Produce Inc's financial stability and ability to meet its debt obligations. A ratio below 1 indicates that the company's earnings may not be sufficient to cover its interest expenses, which could potentially lead to financial difficulties or default on debt payments.
It is important for stakeholders to monitor Fresh Del Monte Produce Inc's interest coverage ratio closely to assess the company's financial health and ability to manage its debt effectively. fluctuations could be due to various factors such as changes in operating income, interest expenses, or overall financial performance.
Peer comparison
Dec 31, 2023