Tennant Company (TNC)
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 | 113,900 | 137,300 | 87,600 | 83,900 | 63,700 |
| Interest expense | US$ in thousands | 9,100 | 13,500 | 7,100 | 7,300 | 20,700 |
| Interest coverage | 12.52 | 10.17 | 12.34 | 11.49 | 3.08 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $113,900K ÷ $9,100K
= 12.52
Interest coverage is a crucial financial ratio that reflects a company's ability to meet its interest payment obligations on outstanding debt. Tennant Company's interest coverage ratio has been trending positively over the years, starting at 3.08 in 2020 and steadily increasing to 11.49 in 2021, 12.34 in 2022, 10.17 in 2023, and peaking at 12.52 in 2024.
The significant improvement in Tennant Company's interest coverage ratio indicates that the company has been generating sufficient operating income to cover its interest expenses comfortably. A higher interest coverage ratio signifies that Tennant Company has a lower risk of defaulting on its debt payments, as it has more earnings available to meet its interest obligations. This positive trend in interest coverage demonstrates Tennant Company's financial stability and ability to manage its debt efficiently over the years.
Peer comparison
Dec 31, 2024