RB Global Inc. (RBA)
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 | 496,700 | 463,767 | 242,239 | 271,193 | 231,939 |
| Interest expense | US$ in thousands | 213,800 | 57,900 | 36,993 | 35,568 | 41,277 |
| Interest coverage | 2.32 | 8.01 | 6.55 | 7.62 | 5.62 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $496,700K ÷ $213,800K
= 2.32
RB Global Inc.'s interest coverage ratio has displayed variations over the past five years. In 2023, the interest coverage ratio decreased to 2.32 from 8.01 in 2022, indicating a potential weakening in the company's ability to cover its interest expenses with its operating income. Despite this decline, the ratio still appears to be above 1, which suggests that the company is generating enough operating income to cover its interest obligations.
Compared to the previous years, RB Global Inc.'s interest coverage was higher in 2022, 2021, and 2020 at 8.01, 6.55, and 7.62, respectively. This indicates that the company was more efficient in servicing its interest payments during those years. However, the interest coverage ratio in 2023 experienced a significant decline compared to the peak in 2022.
The declining trend observed in 2023 should prompt further investigation into the company's financial health and the factors influencing its ability to cover interest expenses. It is important for stakeholders to monitor this ratio closely in the upcoming periods to assess RB Global Inc.'s ability to meet its debt obligations and evaluate its overall financial stability.
Peer comparison
Dec 31, 2023