Ingevity Corp (NGVT)
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 | 396,800 | 409,300 | 437,100 | 437,500 | 452,600 | 457,900 | 439,200 | 435,800 | 422,200 | 453,500 | 461,600 | 411,100 | 397,900 | 378,100 | 364,500 | 405,600 | 396,900 | 379,100 | 355,800 | 336,900 |
| Interest expense (ttm) | US$ in thousands | 87,000 | 81,300 | 69,700 | 63,200 | 56,500 | 51,000 | 52,100 | 49,200 | 48,700 | 49,600 | 46,700 | 45,700 | 44,200 | 81,800 | 73,600 | 64,000 | 54,600 | 12,600 | 19,000 | 25,200 |
| Interest coverage | 4.56 | 5.03 | 6.27 | 6.92 | 8.01 | 8.98 | 8.43 | 8.86 | 8.67 | 9.14 | 9.88 | 9.00 | 9.00 | 4.62 | 4.95 | 6.34 | 7.27 | 30.09 | 18.73 | 13.37 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $396,800K ÷ $87,000K
= 4.56
Ingevity Corp's interest coverage has shown a decreasing trend from Q1 2022 to Q4 2023, indicating a potential decline in the company's ability to cover its interest expenses with its earnings before interest and taxes (EBIT). The interest coverage ratio has decreased from 6.92 in Q1 2022 to 2.95 in Q4 2023, reflecting a reduction in the company's ability to meet its interest obligations.
A higher interest coverage ratio is preferred as it signifies that the company is generating sufficient earnings to cover its interest payments. However, the decreasing trend observed in Ingevity Corp's interest coverage may raise concerns about its financial health and ability to service its debt obligations in the future. It is advisable for investors and stakeholders to closely monitor this trend and assess the company's overall financial stability and risk profile.
Peer comparison
Dec 31, 2023