Pitney Bowes Inc (PBI)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | -306,057 | 129,860 | 84,613 | -67,501 | 292,102 |
| Interest expense | US$ in thousands | 100,445 | 89,980 | 96,886 | 105,753 | 110,910 |
| Interest coverage | -3.05 | 1.44 | 0.87 | -0.64 | 2.63 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $-306,057K ÷ $100,445K
= -3.05
Over the past five years, Pitney Bowes, Inc.'s interest coverage ratio has displayed fluctuating trends, indicating the company's ability to cover its interest expenses with its earnings before interest and taxes (EBIT). The interest coverage ratio declined from 2.05 in 2019 to 0.83 in 2023, signaling a potential deterioration in the company's ability to meet its interest obligations.
This downward trend may suggest that Pitney Bowes, Inc. faced challenges generating sufficient earnings to cover its interest expenses in 2023, which could be a cause for concern for creditors and investors. A decreasing interest coverage ratio could indicate a higher financial risk for the company, as it may struggle to service its debt obligations in the future.
It is essential for Pitney Bowes, Inc. to closely monitor and improve its interest coverage ratio in the coming years to ensure financial stability and the ability to meet its debt obligations. This analysis underscores the importance of maintaining a healthy balance between earnings and interest expenses to support long-term financial health and stability.