Franklin Electric Co Inc (FELE)
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 | 238,166 | 254,013 | 268,759 | 194,902 | 128,324 |
| Interest expense | US$ in thousands | 6,319 | 11,790 | 11,525 | 5,196 | 4,627 |
| Interest coverage | 37.69 | 21.54 | 23.32 | 37.51 | 27.73 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $238,166K ÷ $6,319K
= 37.69
Based on the provided data for Franklin Electric Co Inc, the interest coverage ratio has shown fluctuations over the years. The ratio indicates the company's ability to cover its interest expenses with its operating income.
In December 31, 2020, the interest coverage ratio was 27.73, signifying that the company's operating income was 27.73 times greater than its interest expenses. This high ratio indicates a strong ability to meet interest obligations.
By December 31, 2021, the interest coverage ratio improved to 37.51, suggesting further enhancement in the company's ability to cover interest expenses comfortably.
However, in subsequent years, the interest coverage ratio experienced a decline. By December 31, 2022, the ratio dropped to 23.32, followed by a further decrease to 21.54 by December 31, 2023, indicating a potential decrease in the company's ability to cover interest expenses.
Nevertheless, by December 31, 2024, the interest coverage ratio rebounded to 37.69, surpassing the levels seen in previous years.
Overall, the fluctuating trend in the interest coverage ratio of Franklin Electric Co Inc indicates varying levels of financial risk and operational efficiency in managing interest expenses during the period under review. It is important for stakeholders to monitor this ratio to assess the company's financial health and ability to meet its debt obligations in the future.
Peer comparison
Dec 31, 2024