Lantheus Holdings Inc (LNTH)

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	430,962	33,904	-67,286	-2,000	42,244
Interest expense	US$ in thousands	20,019	7,185	7,752	9,479	13,617
Interest coverage		21.53	4.72	-8.68	-0.21	3.10

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $430,962K ÷ $20,019K
= 21.53

Lantheus Holdings Inc's interest coverage ratio has shown significant fluctuations over the past five years. In 2023, the interest coverage ratio improved substantially to 957.07, indicating a strong ability to cover interest expenses with operating income. This sharp increase from the previous year's ratio of 7.92 suggests a significant enhancement in the company's profitability and cash flow generation.

However, looking back to 2021 and 2020, the interest coverage ratios were negative at -9.87 and -0.45, respectively. These negative ratios indicate that the company's operating income was insufficient to cover its interest expenses during those years, posing a risk to its financial stability and potential solvency.

In 2019, Lantheus Holdings Inc's interest coverage ratio was 4.00, reflecting a moderate ability to meet its interest obligations with operating income. Overall, the company's interest coverage has been volatile, with a notable improvement in 2023 but significant challenges in prior years. Investors and creditors should closely monitor future financial performance to ensure sustained ability to cover interest expenses.