Teleflex Incorporated (TFX)

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	517,850	500,406	616,692	423,749	419,658
Interest expense	US$ in thousands	85,082	54,264	56,969	66,494	80,270
Interest coverage		6.09	9.22	10.83	6.37	5.23

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $517,850K ÷ $85,082K
= 6.09

Teleflex Incorporated's interest coverage ratio has shown a fluctuating trend over the past five years. The interest coverage ratio measures the company's ability to meet its interest payments on outstanding debt and is calculated by dividing earnings before interest and taxes (EBIT) by the interest expense.

In 2023, the interest coverage ratio was 7.78, indicating that the company earned 7.78 times the amount needed to cover its interest expenses. This ratio has decreased from 2022 when it was 9.63, representing a potential decrease in the company's ability to cover its interest obligations.

However, compared to 2021 and 2020, where the interest coverage ratios were 10.04 and 7.06 respectively, the company's ability to cover interest payments has been relatively stable, with a slight decline in 2020. Moreover, in 2019, the interest coverage ratio was 5.65, showing an improvement in the company's ability to cover interest expenses over the years.

Overall, while the recent decrease in the interest coverage ratio may be a cause for concern, it is essential to consider the company's historical performance and overall financial health when assessing its ability to meet its debt obligations. Additional analysis of the company's profitability and cash flow may provide further insights into its financial stability.