Agilysys Inc (AGYS)

Interest coverage

		Mar 31, 2025	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	20,565	25,411	23,511	22,747	18,085	17,576	14,663	13,242	14,780	12,199	10,229	8,847	7,705	-18,844	-22,340	-18,386	-21,190	5,070	2,782	-6,084
Interest expense (ttm)	US$ in thousands	1,115	1,115	458	0	0	904	1,608	1,609	1,610	712	12	12	12	13	18	19	19	17	33	33
Interest coverage		18.44	22.79	51.33	—	—	19.44	9.12	8.23	9.18	17.13	852.42	737.25	642.08	-1,449.54	-1,241.11	-967.68	-1,115.26	298.24	84.30	-184.36

March 31, 2025 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $20,565K ÷ $1,115K
= 18.44

Agilysys Inc's interest coverage ratio has shown significant fluctuations over the period analyzed. The interest coverage ratio measures the company's ability to meet its interest obligations with its earnings before interest and taxes (EBIT). A higher ratio indicates better financial health and the company's ability to comfortably cover its interest expenses.

From June 2020 to March 2022, Agilysys Inc had negative interest coverage ratios, indicating that its EBIT was not sufficient to cover its interest expenses during these periods. This could suggest potential financial distress and a higher risk of defaulting on its debt obligations.

However, starting from March 2022, the interest coverage ratio became positive and improved consistently through September 2023. This positive trend indicates an increase in EBIT relative to interest expenses, showing improved financial strength and the ability to cover interest payments more comfortably.

The interest coverage ratio peaked at 852.42 in September 2022, signaling a strong ability to service its debt. This improvement could be attributed to increased profitability, cost controls, or refinancing of debt at lower interest rates.

In the most recent periods, the interest coverage ratio has stabilized around 20, suggesting a more sustainable level of coverage. Consistent positive interest coverage ratios indicate a healthier financial position for Agilysys Inc, allowing it to manage its interest payments effectively.

Overall, while Agilysys Inc has experienced fluctuations in its interest coverage ratio over the analyzed period, the recent positive trend and stabilization indicate improved financial stability and the ability to meet its interest obligations on a more consistent basis.