Vericel Corp Ord (VCEL)
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 | 11,124 | -1,768 | -19,844 | -12,000 | 3,050 |
| Interest expense | US$ in thousands | 614 | 600 | 366 | 4 | 6 |
| Interest coverage | 18.12 | -2.95 | -54.22 | -3,000.00 | 508.33 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $11,124K ÷ $614K
= 18.12
Vericel Corp Ord's interest coverage ratio has fluctuated significantly over the past five years, indicating potential changes in its ability to meet interest obligations.
As of December 31, 2020, the company had a notably high interest coverage ratio of 508.33, suggesting a strong capacity to cover its interest expenses with earnings before interest and taxes (EBIT).
However, the ratio took a sharp downturn in the following year, plummeting to -3,000.00. A negative interest coverage ratio indicates that Vericel Corp Ord's EBIT was insufficient to cover its interest payments, raising concerns about its financial stability and ability to service debt.
The negative trend continued in the subsequent years, with the interest coverage ratios deteriorating further to -54.22 as of December 31, 2022, -2.95 as of December 31, 2023, before showing a slight improvement to 18.12 as of December 31, 2024.
Overall, the decreasing trend in the interest coverage ratio from 2020 to 2023 indicates potential financial distress and an increased risk of default on interest payments. However, the slight recovery in 2024 could signify a positive turnaround in Vericel Corp Ord's ability to cover its interest expenses with operating income.
Peer comparison
Dec 31, 2024