3M Company (MMM)

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 -8,744,000 -9,406,000 -2,618,000 6,446,000 6,851,000 7,817,000 5,456,000 7,333,000 7,694,000 7,861,000 7,935,000 7,665,000 7,299,000 6,767,000 6,888,000 6,651,000 6,132,000 6,626,000 6,603,000 7,483,000
Interest expense (ttm) US$ in thousands 942,000 686,000 488,000 472,000 462,000 465,000 476,000 469,000 488,000 511,000 522,000 538,000 529,000 512,000 493,000 467,000 448,000 419,000 395,000 372,000
Interest coverage -9.28 -13.71 -5.36 13.66 14.83 16.81 11.46 15.64 15.77 15.38 15.20 14.25 13.80 13.22 13.97 14.24 13.69 15.81 16.72 20.12

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-8,744,000K ÷ $942,000K
= -9.28

The interest coverage ratio for 3M Co. has been volatile over the past eight quarters, ranging from as low as -19.21 in Q3 2023 to a high of 16.01 in Q1 2022. An interest coverage ratio below 1 indicates that the company is not generating enough earnings to cover its interest expenses, which could be a cause for concern. The negative values in Q3 and Q4 of 2023 suggest that the company's earnings were insufficient to cover its interest payments during those periods, indicating potential financial distress. However, the positive values in the preceding quarters indicate that the company was able to comfortably meet its interest obligations.

Overall, the significant fluctuations in 3M Co.'s interest coverage ratio raise questions about the company's ability to manage its debt and generate sustainable earnings. Further scrutiny and analysis of the company's financial performance and debt structure are warranted to assess its financial health accurately.


Peer comparison

Dec 31, 2023


See also:

3M Company Interest Coverage (Quarterly Data)