ABM Industries Incorporated (ABM)
Interest coverage
| Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 215,000 | 303,100 | 405,900 | 416,200 | 413,400 | 385,600 | 334,800 | 317,000 | 351,000 | 327,900 | 229,600 | 204,600 | 208,400 | 225,100 | 327,800 | 161,500 | 98,000 | 91,600 | 56,000 | 226,800 |
| Interest expense (ttm) | US$ in thousands | 85,000 | 83,600 | 83,300 | 83,800 | 82,300 | 77,700 | 67,900 | 54,600 | 41,000 | 31,100 | 26,300 | 26,300 | 28,600 | 32,700 | 40,200 | 42,900 | 44,600 | 46,400 | 45,500 | 47,800 |
| Interest coverage | 2.53 | 3.63 | 4.87 | 4.97 | 5.02 | 4.96 | 4.93 | 5.81 | 8.56 | 10.54 | 8.73 | 7.78 | 7.29 | 6.88 | 8.15 | 3.76 | 2.20 | 1.97 | 1.23 | 4.74 |
October 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $215,000K ÷ $85,000K
= 2.53
Interest coverage is a key financial ratio that indicates a company's ability to meet its interest obligations with its operating income. ABM Industries Incorporated's interest coverage has shown fluctuation over the past several quarters.
The interest coverage ratio has generally been on an upward trend from the beginning of 2020 to mid-2022, indicating an improving ability to cover interest expenses with operating income. This improvement peaked around mid-2022 with a ratio of 10.54, suggesting a strong ability to service its interest payments comfortably.
However, from mid-2022 to late 2023, there was a gradual decline in the interest coverage ratio, which could indicate a potential decrease in profitability or an increase in interest expenses relative to operating income. This decline eventually reversed in late 2023 and continued to improve in early 2024.
As of the most recent data point in October 2024, ABM Industries Incorporated's interest coverage stood at 2.53, which is lower compared to the peak in mid-2022 but still above 2, indicating that the company earns enough operating income to cover its interest expenses. It is important for investors and creditors to monitor this ratio over time to assess the company's ability to meet its interest payments and manage its debt obligations.
Peer comparison
Oct 31, 2024