KAR Auction Services Inc (KAR)

Interest coverage

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Earnings before interest and tax (EBIT)	US$ in thousands	10,000	370,400	207,300	117,500	415,700
Interest expense	US$ in thousands	155,800	119,200	125,700	128,200	189,500
Interest coverage		0.06	3.11	1.65	0.92	2.19

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $10,000K ÷ $155,800K
= 0.06

The interest coverage ratio for Openlane Inc. has fluctuated over the past five years. In 2023, the interest coverage ratio improved to 1.58 from 1.17 in 2022, indicating that the company generated 1.58 times more operating income than the interest expenses incurred during the year. This indicates a stronger ability to meet interest obligations with operating profits.

In 2021, the interest coverage ratio was 1.66, slightly higher than 1.29 in 2020, but similar to the ratio reported in 2019. Despite some fluctuations, the company has generally maintained a level of coverage that suggests it is able to meet interest payments with its earnings, although it may have faced some challenges in certain years.

Overall, the trend in Openlane Inc.'s interest coverage ratio suggests a need for continued monitoring to ensure that the company maintains a sufficient cushion to cover its interest expenses and remains financially healthy. fluctuations in the ratio could be an indicator of changing operating performance or financial leverage.