TE Connectivity Ltd (TEL)
Interest coverage
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 2,354,000 | 2,800,000 | 2,440,000 | 590,000 | 1,897,000 |
| Interest expense | US$ in thousands | 80,000 | 66,000 | 56,000 | 48,000 | 68,000 |
| Interest coverage | 29.42 | 42.42 | 43.57 | 12.29 | 27.90 |
September 30, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $2,354,000K ÷ $80,000K
= 29.42
TE Connectivity Ltd's interest coverage ratio has fluctuated over the past five years. In 2023, the interest coverage ratio stands at 29.42, indicating that the company generated 29.42 times the amount needed to cover its interest expenses. This represents a decrease from the previous year, where the ratio was 42.42. Despite the decrease, the ratio remains relatively high, suggesting that the company continues to have a strong ability to meet its interest obligations.
Comparing to the ratios in 2021 and 2020, which were 43.57 and 12.29, respectively, it is evident that there was a significant improvement in the company's ability to cover its interest payments in 2021 and a notable decline in 2020.
Overall, TE Connectivity Ltd's interest coverage ratio has displayed variability over the past five years, with some fluctuations but generally maintaining a solid position to meet its interest expenses.
Peer comparison
Sep 30, 2023