Somnigroup International Inc. (SGI)
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 | 601,400 | 677,700 | 889,100 | 528,400 | 349,900 |
| Interest expense | US$ in thousands | 129,900 | 103,000 | 66,300 | 77,000 | 85,700 |
| Interest coverage | 4.63 | 6.58 | 13.41 | 6.86 | 4.08 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $601,400K ÷ $129,900K
= 4.63
The interest coverage ratio of Somnigroup International Inc. has shown fluctuating trends over the past five years.
In December 2019, the company had an interest coverage ratio of 4.08, indicating that it generated operating income 4.08 times its interest expenses. This level suggests moderate ability to cover its interest payments.
By December 2020, the interest coverage ratio improved to 6.86, signifying a stronger ability to cover interest costs compared to the previous year.
In December 2021, the interest coverage ratio increased significantly to 13.41, reaching its peak over the given period. This indicates a robust ability to meet interest obligations with operating income.
However, in December 2022, the interest coverage ratio dropped to 6.58, although still higher than in 2019, showing a slight decline in the company's ability to cover interest expenses.
Finally, by December 2023, the interest coverage ratio fell further to 4.63, dropping below the levels seen in the previous years. This decline may raise some concerns regarding the company's ability to comfortably meet its interest payments.
Overall, the trend in Somnigroup International Inc.'s interest coverage ratio reflects fluctuations in its ability to handle interest expenses over the past five years, with periods of improvement followed by some decline. Further analysis of the company's financial performance and interest obligations may be necessary to assess its future financial stability and investment potential.
Peer comparison
Dec 31, 2023