Myriad Genetics Inc (MYGN)

Interest coverage

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	—	-248,000	-123,700	-48,700	-194,800
Interest expense	US$ in thousands	2,800	2,900	3,200	6,600	12,000
Interest coverage		0.00	-85.52	-38.66	-7.38	-16.23

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $2,800K
= 0.00

The interest coverage ratio measures a company's ability to cover its interest expenses with its earnings before interest and taxes (EBIT). A higher ratio indicates a stronger ability to meet interest obligations.

Looking at the historical data for Myriad Genetics Inc, the trend in interest coverage is concerning. In 2020, the interest coverage ratio was at a negative 16.23, indicating that the company's EBIT was insufficient to cover its interest expenses.

Moving to 2021, the interest coverage ratio improved slightly to -7.38 but still remained negative, indicating ongoing challenges in meeting interest payments with operating earnings.

By the end of 2022, the interest coverage ratio worsened significantly to -38.66, suggesting a further deterioration in the company's ability to service its debt.

In 2023, the interest coverage ratio deteriorated even more, reaching a concerning -85.52, indicating a substantial decline in the company's ability to cover its interest expenses.

Surprisingly, the data for 2024 shows an interest coverage ratio of 0.00, which typically suggests that the company's EBIT exactly covered its interest expenses for that period.

Overall, the trend in Myriad Genetics Inc's interest coverage ratio over the years reflects a concerning pattern of declining ability to cover interest expenses with operating earnings. This situation may raise concerns about the company's financial stability and ability to manage its debt obligations effectively.