International Flavors & Fragrances Inc (IFF)
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 | 583,000 | -2,138,000 | -1,289,000 | 642,000 | 572,315 |
| Interest expense | US$ in thousands | 305,000 | 380,000 | 336,000 | 289,000 | 131,802 |
| Interest coverage | 1.91 | -5.63 | -3.84 | 2.22 | 4.34 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $583,000K ÷ $305,000K
= 1.91
Based on the provided data, the interest coverage ratio of International Flavors & Fragrances Inc has shown some fluctuations over the years. In December 31, 2020, the interest coverage ratio was at a comfortable level of 4.34, indicating that the company generated 4.34 times the operating income to cover its interest expenses.
However, there was a significant decrease in the interest coverage ratio in the following year, with the ratio dropping to 2.22 as of December 31, 2021. This suggests that the company's ability to cover its interest expenses with operating income weakened.
The financial health of the company's interest coverage deteriorated further in the subsequent years, with ratios of -3.84, -5.63, and 1.91 on December 31, 2022, 2023, and 2024 respectively. Negative values indicate that the company's operating income was insufficient to cover its interest expenses during these periods.
Overall, the declining trend in the interest coverage ratio raises concerns about the company's ability to meet its interest obligations from its operating income. It is important for stakeholders to closely monitor the company's financial performance and leverage levels to ensure sustainability and viability in the long term.
Peer comparison
Dec 31, 2024