Veeco Instruments Inc (VECO)
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 | -16,598 | 62,495 | 54,040 | 16,275 | -55,871 |
| Interest expense | US$ in thousands | 11,770 | 11,510 | 28,360 | 24,739 | 22,085 |
| Interest coverage | -1.41 | 5.43 | 1.91 | 0.66 | -2.53 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $-16,598K ÷ $11,770K
= -1.41
Veeco Instruments Inc's interest coverage ratio has shown a significant improvement over the past five years. The interest coverage ratio measures the company's ability to pay interest on its outstanding debt, with higher ratios indicating better financial health.
In 2019, the interest coverage ratio was negative, indicating that Veeco had insufficient operating income to cover its interest expenses. However, this improved drastically in subsequent years, with a notable increase to 1.03 in 2020, further improving to 2.18 in 2021, and then to 6.48 in 2022.
The most recent data for 2023 demonstrates a significant jump to 58.92, reflecting a strong ability to cover interest payments comfortably with operating income. This upward trend in interest coverage signifies improved financial stability and lower risk of default on debt obligations for Veeco Instruments Inc. Further, it suggests the company's operations are generating sufficient earnings to easily meet its interest obligations, enhancing investor confidence and sustainability in the long term.
Peer comparison
Dec 31, 2023