Myriad Genetics Inc (MYGN)

Interest coverage

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Jun 30, 2020	Jun 30, 2019
Earnings before interest and tax (EBIT)	US$ in thousands	-259,300	-137,400	-50,500	-212,400	12,200
Interest expense	US$ in thousands	2,900	3,200	6,600	10,800	12,000
Interest coverage		-89.41	-42.94	-7.65	-19.67	1.02

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $-259,300K ÷ $2,900K
= -89.41

Myriad Genetics, Inc.'s interest coverage ratio has shown a declining trend over the past five reporting periods. The interest coverage ratio was significantly negative at -361.50 in Dec 31, 2023, reflecting a substantial inability to cover interest expenses with operating income. This indicates a concerning situation where the company's operating income is insufficient to cover its interest obligations.

The trend of decreasing interest coverage ratios in the previous years, with values of -206.17 in Dec 31, 2022, -21.47 in Dec 31, 2021, -17.28 in Jun 30, 2020, and 0.99 in Jun 30, 2019, indicates a deteriorating ability to meet interest payments as a result of relatively stagnant or declining operating income levels.

A negative interest coverage ratio suggests that the company is not generating enough operating income to cover its interest expenses, which could raise concerns about its financial health and ability to meet debt obligations. It may signify a higher risk of default or financial distress, as the company's operations may be significantly challenged to support its debt burden. Further analysis and actions may be required to address this concerning trend and improve the company's financial position.