Ufp Industries Inc (UFPI)
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 | 683,938 | 936,413 | 723,426 | 343,190 | 246,620 |
| Interest expense | US$ in thousands | 12,842 | 13,910 | 13,814 | 9,311 | 8,700 |
| Interest coverage | 53.26 | 67.32 | 52.37 | 36.86 | 28.35 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $683,938K ÷ $12,842K
= 53.26
The interest coverage ratio for Ufp Industries Inc has exhibited a generally increasing trend over the past five years, indicating an improving ability of the company to cover its interest obligations with its operating income. The ratio stood at 53.26 in 2023, compared to 67.32 in 2022, 52.37 in 2021, 36.86 in 2020, and 28.35 in 2019.
This trend suggests that the company's earnings before interest and taxes (EBIT) are increasingly able to cover its interest expenses. A higher interest coverage ratio signifies that the company is in a better position to meet its interest payments and is generally viewed as a positive indicator of financial health and stability. However, it's important to take into consideration other factors such as the company's overall debt levels and the industry benchmarks when evaluating the significance of the interest coverage ratio.