Sealed Air Corporation (SEE)
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 | 695,000 | 735,400 | 814,900 | 797,900 | 891,900 | 969,200 | 939,400 | 939,300 | 899,600 | 833,800 | 831,500 | 823,500 | 819,400 | 749,000 | 693,900 | 594,600 | 523,700 | 526,800 | 544,700 | 648,400 |
| Interest expense (ttm) | US$ in thousands | 263,000 | 239,600 | 210,400 | 181,200 | 162,300 | 159,500 | 161,000 | 163,600 | 167,800 | 171,300 | 171,900 | 173,100 | 174,400 | 178,200 | 183,700 | 183,600 | 184,100 | 183,200 | 179,500 | 180,800 |
| Interest coverage | 2.64 | 3.07 | 3.87 | 4.40 | 5.50 | 6.08 | 5.83 | 5.74 | 5.36 | 4.87 | 4.84 | 4.76 | 4.70 | 4.20 | 3.78 | 3.24 | 2.84 | 2.88 | 3.03 | 3.59 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $695,000K ÷ $263,000K
= 2.64
The interest coverage ratio measures a company's ability to meet its interest payment obligations on its outstanding debt. It is calculated by dividing earnings before interest and taxes (EBIT) by the interest expense. A higher interest coverage ratio indicates that the company is more capable of servicing its debt.
Sealed Air Corp.'s interest coverage ratios have been relatively stable over the past eight quarters, ranging from 3.12 to 6.18. The trend shows a generally decreasing pattern over this period, indicating a slight deterioration in the company's ability to cover its interest expenses with its operating earnings.
While the interest coverage ratios are above 1, which indicates the company is generating enough earnings to cover its interest payments, the declining trend warrants attention. A decreasing interest coverage ratio could signal potential financial distress if the trend continues.
Overall, Sealed Air Corp. should closely monitor its interest coverage ratio and take steps to improve its ability to cover its interest expenses in the future to ensure financial stability and sustainability.
Peer comparison
Dec 31, 2023