UPM-Kymmene Oyj (OHEL:UPM) Interest Coverage

: 5.25 (As of Dec. 2023)

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Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. UPM-Kymmene Oyj's Operating Income for the three months ended in Dec. 2023 was €231 Mil. UPM-Kymmene Oyj's Interest Expense for the three months ended in Dec. 2023 was €-44 Mil. UPM-Kymmene Oyj's interest coverage for the quarter that ended in Dec. 2023 was 5.25. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for UPM-Kymmene Oyj's Interest Coverage or its related term are showing as below:

OHEL:UPM' s Interest Coverage Range Over the Past 10 Years
Min: 5.49 Med: 15.63 Max: 42.07
Current: 7.25

OHEL:UPM's Interest Coverage is ranked better than
53.47% of 202 companies
in the Forest Products industry
Industry Median: 6.115 vs OHEL:UPM: 7.25

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

UPM-Kymmene Oyj Interest Coverage Historical Data

The historical data trend for UPM-Kymmene Oyj's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

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UPM-Kymmene Oyj Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Interest Coverage

29.36

15.43

30.38

31.21

7.23

UPM-Kymmene Oyj Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Interest Coverage																22.33	53.17	8.46	-	5.25

Competitive Comparison

For the Paper & Paper Products subindustry, UPM-Kymmene Oyj's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

UPM-Kymmene Oyj Interest Coverage Distribution

For the Forest Products industry and Basic Materials sector, UPM-Kymmene Oyj's Interest Coverage distribution charts can be found below:

* The bar in red indicates where UPM-Kymmene Oyj's Interest Coverage falls into.

UPM-Kymmene Oyj Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

UPM-Kymmene Oyj's Interest Coverage for the fiscal year that ended in Dec. 2023 is calculated as

Here, for the fiscal year that ended in Dec. 2023, UPM-Kymmene Oyj's Interest Expense was €-87 Mil. Its Operating Income was €629 Mil. And its Long-Term Debt & Capital Lease Obligation was €2,962 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Dec. 2023 )	/	Interest Expense (A: Dec. 2023 )
	=	-1	*	629	/	-87
	=	7.23

UPM-Kymmene Oyj's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the three months ended in Dec. 2023, UPM-Kymmene Oyj's Interest Expense was €-44 Mil. Its Operating Income was €231 Mil. And its Long-Term Debt & Capital Lease Obligation was €2,962 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Dec. 2023 )	/	Interest Expense (Q: Dec. 2023 )
	=	-1	*	231	/	-44
	=	5.25

The higher the ratio, the stronger the company's Financial Strength is.

UPM-Kymmene Oyj (OHEL:UPM) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

UPM-Kymmene Oyj Interest Coverage Related Terms

Thank you for viewing the detailed overview of UPM-Kymmene Oyj's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

UPM-Kymmene Oyj (OHEL:UPM) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Forest Products » UPM-Kymmene Oyj (OHEL:UPM) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

UPMMY:USA UPMKF:USA UPMh:UK 0NV5:UK RPL:Germany

Address

Alvar Aallon katu 1, P.O. Box 380, Helsinki, FIN, FI-00100

Website

https://www.upm.com

UPM-Kymmene Oyj is a Finnish paper and biomaterials company. The company produces products related to the forestry industry including paper, pulp, and plywood. UPM is also a major electricity generator in Finland and is one of the global producers of self-adhesive labeling materials. It delivers responsible solutions and innovation for a future beyond fossils across six business areas: UPM Fibres, UPM Energy, UPM Raflatac, UPM Specialty Papers, UPM Communication Papers, and UPM Plywood. Geographically, the company has operational footprints in Sweden, Finland, the Netherlands, and other regions.

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