International Flavors & Fragrances Inc (IFF)
Interest coverage
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 583,000 | -1,969,000 | -1,969,000 | -2,065,000 | -2,138,000 | 576,000 | -1,546,000 | -1,507,000 | -1,277,000 | -1,208,000 | 1,066,000 | 980,000 | 634,000 | 594,939 | 414,068 | 429,981 | 606,413 | 631,116 | 681,134 | 748,079 |
| Interest expense (ttm) | US$ in thousands | 305,000 | 279,000 | 315,000 | 352,000 | 380,000 | 441,000 | 414,000 | 375,000 | 336,000 | 305,000 | 296,000 | 296,000 | 289,000 | 248,756 | 209,600 | 164,662 | 131,802 | 134,605 | 133,258 | 133,789 |
| Interest coverage | 1.91 | -7.06 | -6.25 | -5.87 | -5.63 | 1.31 | -3.73 | -4.02 | -3.80 | -3.96 | 3.60 | 3.31 | 2.19 | 2.39 | 1.98 | 2.61 | 4.60 | 4.69 | 5.11 | 5.59 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $583,000K ÷ $305,000K
= 1.91
The interest coverage ratio for International Flavors & Fragrances Inc has displayed volatility over the periods under consideration. The ratio was relatively stable at above 4.5 for most of 2020 and 2021, indicating the company's ability to meet its interest obligations comfortably with its operating income. However, a significant decline in the ratio was observed starting from March 31, 2021, reaching negative values in the latter part of 2022 and continuing through 2024.
A declining interest coverage ratio suggests that the company may be facing challenges in generating sufficient operating income to cover its interest expenses. Negative values indicate that the company's operating income is insufficient to cover its interest payments, raising concerns about its financial health and ability to service debt obligations.
The company should consider taking proactive measures to improve its interest coverage ratio, such as increasing operating income through cost-cutting measures, revenue growth, or restructuring debt to reduce interest expenses. Investors, creditors, and other stakeholders may closely monitor this ratio as an indicator of the company's financial stability and ability to meet its debt obligations in the future.
Peer comparison
Dec 31, 2024