MDU Resources Group Inc (MDU)
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 | 588,488 | 581,545 | 561,035 | 571,314 | 497,319 |
| Interest expense | US$ in thousands | 114,308 | 80,698 | 93,984 | 96,519 | 98,587 |
| Interest coverage | 5.15 | 7.21 | 5.97 | 5.92 | 5.04 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $588,488K ÷ $114,308K
= 5.15
MDU Resources Group Inc's interest coverage ratio has shown a fluctuating trend over the past five years, ranging from 3.73 in 2023 to 5.68 in 2021. The interest coverage ratio indicates the company's ability to meet its interest obligations from its operating income. A higher ratio suggests a better ability to pay interest expenses.
In 2023, the interest coverage ratio decreased to 3.73 from 4.81 in 2022, which may raise concerns about the company's ability to cover its interest payments with its operating income. However, the ratio is still above 1, indicating that the company is generating enough operating income to cover its interest expenses.
Despite the slight decrease in 2023, MDU Resources Group Inc has generally maintained a healthy interest coverage ratio above 3 in the past five years, demonstrating a solid ability to meet its interest obligations. This trend suggests a relatively stable financial position in terms of debt management and interest payment capacity. Further analysis of the company's cash flow and overall debt levels would provide a more comprehensive assessment of its financial health.
Peer comparison
Dec 31, 2023