Solventum Corp. (SOLV)
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 | — | 1,480,000 | 1,693,000 | 1,879,000 | 1,430,000 |
| Interest expense | US$ in thousands | 367,000 | 0 | 0 | — | — |
| Interest coverage | 0.00 | — | — | — | — |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $367,000K
= 0.00
Based on the provided data for Solventum Corp., the interest coverage ratio for the fiscal years ending on December 31, 2020, 2021, 2022, and 2023 is not available ("—"). However, the interest coverage ratio for the fiscal year ending on December 31, 2024, is 0.00.
An interest coverage ratio of 0.00 implies that the company's operating income is insufficient to cover its interest expense for the year. This could indicate a significant financial risk, as the company may struggle to make interest payments on its debt obligations using its current level of operating income.
It is essential for Solventum Corp. to improve its interest coverage ratio in the future to demonstrate its ability to meet its interest obligations comfortably. A low or declining interest coverage ratio can be a cause for concern for creditors, investors, and other stakeholders, as it may signal potential financial distress or an unsustainable debt load for the company.
Peer comparison
Dec 31, 2024