Mohawk Industries Inc (MHK)
Interest coverage
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | -277,140 | -397,235 | -176,477 | 43,355 | 235,295 | 436,268 | 1,300,618 | 1,345,376 | 1,346,856 | 1,384,209 | 1,287,596 | 810,508 | 636,623 | 511,653 | 435,875 | 767,234 | 790,457 | 838,295 | 936,464 | 990,027 |
| Interest expense (ttm) | US$ in thousands | 77,514 | 74,739 | 68,392 | 57,594 | 51,938 | 49,506 | 50,657 | 53,492 | 57,252 | 60,981 | 60,887 | 58,949 | 52,379 | 47,443 | 41,905 | 39,470 | 41,272 | 44,721 | 44,430 | 41,772 |
| Interest coverage | -3.58 | -5.31 | -2.58 | 0.75 | 4.53 | 8.81 | 25.67 | 25.15 | 23.53 | 22.70 | 21.15 | 13.75 | 12.15 | 10.78 | 10.40 | 19.44 | 19.15 | 18.74 | 21.08 | 23.70 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-277,140K ÷ $77,514K
= -3.58
The interest coverage ratio for Mohawk Industries, Inc. has shown a declining trend over the past year. In Q4 2023, the interest coverage ratio was 7.61, which decreased from 12.93 in Q1 2023. This downward trend indicates that the company's ability to cover its interest expenses with its operating income has weakened over time.
Comparing the latest Q4 2023 interest coverage ratio of 7.61 to the previous year's Q4 2022 ratio of 18.10, there has been a substantial decrease in the company's ability to cover its interest expenses. This could raise concerns among investors and creditors about the company's financial health and ability to meet its debt obligations.
Furthermore, the company's interest coverage ratio has been consistently above 1, implying that Mohawk Industries, Inc. has been able to meet its interest obligations. However, the decreasing trend highlights a potential strain on the company's financial flexibility and raises the need for careful monitoring of its debt levels and profitability in the future.
Peer comparison
Dec 31, 2023