GE Vernova LLC (GEV)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | -480,000 | -1,743,000 | -378,000 |
| Interest expense | US$ in thousands | 71,000 | 151,000 | 172,000 |
| Interest coverage | -6.76 | -11.54 | -2.20 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $-480,000K ÷ $71,000K
= -6.76
The interest coverage ratio for GE Vernova LLC has shown a declining trend over the last three years, indicating a deteriorating ability of the company to cover its interest expenses with its operating income. The negative values for the interest coverage ratio in all three years indicate that the company's operating income is insufficient to cover its interest expenses.
Moreover, the magnitude of the negative interest coverage ratios has increased over the period, reaching -6.76 in 2023 from -2.20 in 2021. This highlights a worsening financial situation and raises concerns about the company's financial viability in meeting its interest payment obligations.
Overall, the consistently negative and worsening trend in the interest coverage ratio for GE Vernova LLC suggests a high level of financial risk and indicates potential challenges in servicing its debt obligations.
Peer comparison
Dec 31, 2023