Kirby Corporation (KEX)

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	346,163	209,093	-248,315	-413,566	245,142
Interest expense	US$ in thousands	52,008	44,588	42,469	48,739	55,994
Interest coverage		6.66	4.69	-5.85	-8.49	4.38

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $346,163K ÷ $52,008K
= 6.66

Kirby Corp.'s interest coverage ratio has shown significant fluctuations over the past five years. The ratio was at its lowest in 2021, at 1.81, indicating that the company's operating income was only sufficient to cover its interest expenses 1.81 times over. This suggests a higher financial risk for the company during that period.

However, there was a substantial improvement in 2023, with the interest coverage ratio increasing to 6.35. This indicates a stronger ability on the part of Kirby Corp. to meet its interest obligations from its operating income, reflecting improved financial health.

The fluctuations in the interest coverage ratio over the years could be attributed to changes in the company's operating income and its interest expenses. It is essential for investors and creditors to closely monitor Kirby Corp.'s interest coverage ratio to assess its ability to service its debt obligations in the long term.