Regal Beloit Corporation (RRX)
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 | 647,700 | 377,100 | 702,300 | 370,500 | 291,300 |
| Interest expense | US$ in thousands | 399,700 | 431,000 | 87,200 | 60,400 | 39,800 |
| Interest coverage | 1.62 | 0.87 | 8.05 | 6.13 | 7.32 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $647,700K ÷ $399,700K
= 1.62
The interest coverage ratio of Regal Beloit Corporation has shown some fluctuations over the years. As of December 31, 2020, the company had an interest coverage ratio of 7.32, indicating that it was able to cover its interest expenses 7.32 times over with its operating income.
By December 31, 2021, this ratio had decreased to 6.13, suggesting a slight weakening in the company's ability to cover its interest obligations.
However, by December 31, 2022, the interest coverage ratio improved to 8.05, showing a positive trend in the company's ability to meet its interest payments.
Unfortunately, there was a significant decline in the interest coverage ratio by December 31, 2023, dropping to 0.87. This sharp decline may raise concerns about the company's ability to cover its interest expenses from its operating income.
By December 31, 2024, the interest coverage ratio recovered slightly to 1.62, but it still remains relatively low, indicating that Regal Beloit Corporation may need to closely monitor its ability to meet its interest obligations in the future.
Peer comparison
Dec 31, 2024