Titan International Inc (TWI)

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	123,587	229,265	82,956	-22,888	-12,946
Interest expense	US$ in thousands	18,785	29,796	32,221	30,554	32,004
Interest coverage		6.58	7.69	2.57	-0.75	-0.40

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $123,587K ÷ $18,785K
= 6.58

Titan International, Inc.'s interest coverage has shown a positive trend over the past five years, indicating the company's improving ability to meet its interest obligations. The interest coverage ratio has increased from -0.81 in 2019 to 7.98 in 2023. This suggests that the company's operating income is now nearly eight times its interest expense, reflecting a strong ability to service its debt.

The significant improvement in interest coverage from negative values in 2019 and 2020 to positive values in subsequent years is a positive sign of the company's financial health. A ratio above 1 indicates that the company is generating enough operating income to cover its interest payments, with higher values indicating greater financial stability.

Overall, Titan International, Inc.'s interest coverage has strengthened consistently over the years, signaling a positive trajectory in managing its debt obligations. Investors and creditors may view this trend favorably as it implies a reduced risk of default and a healthier financial position for the company.