Sonoco Products Company (SON)
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 | 760,923 | 751,503 | 734,323 | 744,868 | 686,608 | 659,681 | 602,371 | -32,555 | -88,915 | -179,780 | -206,060 | 326,652 | 335,539 | 401,595 | 434,866 | 463,310 | 451,899 | 471,073 | 442,354 | 451,828 |
| Interest expense (ttm) | US$ in thousands | 136,686 | 131,783 | 125,650 | 115,313 | 101,662 | 84,466 | 72,505 | 66,071 | 63,991 | 70,344 | 74,968 | 77,018 | 75,046 | 72,198 | 70,107 | 67,342 | 66,845 | 66,262 | 64,965 | 64,384 |
| Interest coverage | 5.57 | 5.70 | 5.84 | 6.46 | 6.75 | 7.81 | 8.31 | -0.49 | -1.39 | -2.56 | -2.75 | 4.24 | 4.47 | 5.56 | 6.20 | 6.88 | 6.76 | 7.11 | 6.81 | 7.02 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $760,923K ÷ $136,686K
= 5.57
The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. Sonoco Products Co. has shown a consistent and healthy interest coverage ratio in recent quarters. The trend indicates that the company has been able to comfortably meet its interest obligations, with ratios ranging from 5.58 to 9.32 over the past eight quarters.
The downward trend in the interest coverage ratio over the quarters could be an indication that the company's ability to cover interest expenses has been weakening. However, the ratios still remain at a level that signifies a strong ability to pay off interest obligations. It is important for analysts to further investigate the factors influencing this trend to assess any potential risks associated with interest coverage in the future.
Peer comparison
Dec 31, 2023