Incyte Corporation (INCY)

Interest coverage

Dec 31, 2024 Sep 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 Dec 31, 2019
Earnings before interest and tax (EBIT) (ttm) US$ in thousands 955,947 888,856 1,021,030 836,766 646,288 561,095 512,892 531,782 571,272 631,951 573,886 572,352 620,110 407,243 543,116 -230,039 -271,958 -120,431 -319,261 488,645
Interest expense (ttm) US$ in thousands 2,427 2,631 2,512 2,551 2,414 2,432 2,455 2,666 2,751 2,549 2,229 1,908 1,584 1,689 1,931 2,174 2,353 2,406 2,122 1,855
Interest coverage 393.88 337.84 406.46 328.01 267.72 230.71 208.92 199.47 207.66 247.92 257.46 299.97 391.48 241.11 281.26 -105.81 -115.58 -50.05 -150.45 263.42

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $955,947K ÷ $2,427K
= 393.88

Incyte Corporation's interest coverage ratio has experienced fluctuations over the past years. The interest coverage ratio measures the company's ability to meet its interest obligations with its earnings before interest and taxes (EBIT).

Between December 31, 2019, and June 30, 2020, Incyte Corporation's interest coverage ratio decreased significantly from a very high 263.42 to a negative value, indicating potential difficulties in meeting interest payments with its earnings during that period. This negative trend continued until December 31, 2020, with the interest coverage ratio remaining below zero.

However, from March 31, 2021, to December 31, 2021, there was a notable turnaround as the interest coverage ratio increased substantially, reaching levels above 200 and even approaching 400 by March 31, 2024.

Overall, Incyte Corporation's interest coverage ratio has shown volatility, with both positive and negative swings in its ability to cover interest expenses with operating profits. This suggests a varying financial performance and highlights the importance of continuous monitoring of the company's financial health and management of its debt obligations.