Helix Energy Solutions Group Inc (HLX)

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	115,965	28,873	-55,005	-47,153	30,742
Interest expense	US$ in thousands	33,901	21,359	18,950	23,201	28,531
Interest coverage		3.42	1.35	-2.90	-2.03	1.08

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $115,965K ÷ $33,901K
= 3.42

The interest coverage ratio of Helix Energy Solutions Group Inc has been fluctuating over the past few years. In December 31, 2020, the interest coverage ratio was 1.08, indicating that the company barely generated enough operating income to cover its interest expenses. However, in the following years, the interest coverage ratio deteriorated significantly, reaching -2.03 in December 31, 2021, -2.90 in December 31, 2022. These negative values suggest that the company's operating income was insufficient to cover its interest expenses, raising concerns about its ability to meet its debt obligations using current earnings.

On the bright side, there was a slight improvement in the interest coverage ratio in December 31, 2023, with a value of 1.35, indicating better coverage of interest expenses. This improvement suggests that the company may have increased its operating income relative to its interest expenses.

Further improvement was seen in December 31, 2024, with an interest coverage ratio of 3.42. This higher value indicates that the company's operating income was more than sufficient to cover its interest expenses, reflecting a positive trend in its ability to meet its interest obligations.

Overall, while there have been fluctuations in Helix Energy Solutions Group Inc's interest coverage ratio over the years, the recent improvements suggest a positive direction in managing its debt obligations and financial health. It will be crucial for the company to sustain this positive trend to ensure long-term financial stability.