Mativ Holdings Inc. (MATV)
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 | -220,500 | 66,900 | 125,600 | 132,700 | 137,100 |
| Interest expense | US$ in thousands | 62,200 | 57,300 | 46,100 | 30,500 | 36,100 |
| Interest coverage | -3.55 | 1.17 | 2.72 | 4.35 | 3.80 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $-220,500K ÷ $62,200K
= -3.55
The interest coverage ratio of Mativ Holdings Inc has shown a significant decline over the past five years. The ratio has decreased from 3.93 in 2019 to 0.16 in 2023. This trend indicates that the company's ability to cover its interest expenses with its operating income has weakened over time. A lower interest coverage ratio indicates a higher financial risk, as it suggests that the company may have difficulty meeting its interest obligations with its current level of earnings. Mativ Holdings Inc's decreasing interest coverage ratio warrants further investigation into the company's financial health and sustainability in managing its debt obligations.
Peer comparison
Dec 31, 2023