Vir Biotechnology Inc (VIR)
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 | -552,170 | -684,305 | 817,576 | 408,768 | -298,719 |
| Interest expense | US$ in thousands | — | — | 183,145 | 272,911 | 3,811 |
| Interest coverage | — | — | 4.46 | 1.50 | -78.38 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $-552,170K ÷ $—K
= —
Based on the provided data, the interest coverage ratio for Vir Biotechnology Inc has shown a significant improvement over the years. In December 31, 2020, the interest coverage ratio was negative at -78.38, indicating that the company's operating profit was insufficient to cover its interest expenses. However, by December 31, 2021, the interest coverage ratio improved to 1.50, indicating that the company's operating profit was just sufficient to cover its interest expenses.
The trend continued to improve as by December 31, 2022, the interest coverage ratio further increased to 4.46, suggesting that the company's ability to cover its interest expenses has strengthened. However, it's worth noting that the data for December 31, 2023 and December 31, 2024 is not available (represented as "—"), hence we are unable to assess the company's interest coverage for these years.
Overall, the increasing trend in the interest coverage ratio from a negative value to positive values indicates a positive trajectory for Vir Biotechnology Inc in terms of its ability to meet its interest obligations with its operating profits. It suggests an improving financial health and reduced risk of default due to insufficient cash flow to cover interest expenses. Continued monitoring of this ratio will be essential to gauge the company's financial stability and ability to manage its debt obligations.
Peer comparison
Dec 31, 2024