Supernus Pharmaceuticals Inc (SUPN)
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 | -1 | 46,124 | 92,871 | 188,083 | 165,694 |
| Interest expense | US$ in thousands | 1 | 7,070 | 19,696 | 19,435 | 18,207 |
| Interest coverage | -1.00 | 6.52 | 4.72 | 9.68 | 9.10 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $-1K ÷ $1K
= -1.00
The interest coverage ratio measures the company's ability to meet its interest obligations with its operating income. A higher interest coverage ratio indicates that the company is more capable of servicing its debt.
Looking at the trend for Supernus Pharmaceuticals Inc over the past five years, we observe a significant decline in the interest coverage ratio. In 2019 and 2020, the company had very high interest coverage ratios of 137.06 and 34.77, respectively, indicating a strong ability to cover its interest payments. However, in the subsequent years, the interest coverage ratio decreased sharply to 3.39, then further to 6.45, and finally to 5.55 in 2023.
This decline in the interest coverage ratio suggests a decreasing ability of Supernus Pharmaceuticals Inc to cover its interest expenses with its operating income. A lower interest coverage ratio may indicate increased financial risk and potential difficulty in meeting debt obligations. It is crucial for the company to closely monitor and manage its debt levels to ensure sufficient cash flows for servicing its debt and maintaining financial stability.
Peer comparison
Dec 31, 2023