Alamo Group Inc (ALG)
Interest coverage
| 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 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 168,828 | 175,695 | 184,839 | 195,922 | 197,967 | 195,886 | 183,479 | 169,926 | 148,341 | 133,491 | 126,520 | 122,817 | 120,474 | 107,453 | 116,077 | 100,620 | 102,077 | 116,423 | 102,679 | 110,384 |
| Interest expense (ttm) | US$ in thousands | 20,548 | 23,662 | 25,505 | 26,244 | 26,093 | 24,297 | 21,302 | 17,654 | 14,361 | 11,976 | 10,902 | 10,567 | 10,533 | 11,043 | 11,844 | 12,931 | 15,837 | 18,446 | 16,822 | 14,816 |
| Interest coverage | 8.22 | 7.43 | 7.25 | 7.47 | 7.59 | 8.06 | 8.61 | 9.63 | 10.33 | 11.15 | 11.61 | 11.62 | 11.44 | 9.73 | 9.80 | 7.78 | 6.45 | 6.31 | 6.10 | 7.45 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $168,828K ÷ $20,548K
= 8.22
The interest coverage ratio for Alamo Group Inc has shown a generally positive trend over the analyzed period from March 31, 2020, to December 31, 2024. The ratio has improved from 7.45 in March 2020 to 8.22 in December 2024.
This indicates that the company's ability to cover its interest expenses with its operating profits has strengthened over time. A higher interest coverage ratio suggests that the company is more capable of meeting its interest obligations from its earnings.
The consistent improvement in the interest coverage ratio is a positive sign of Alamo Group Inc's financial health and indicates that the company has been effectively managing its interest costs relative to its operating profits. This trend is generally viewed favorably by investors and creditors, as it demonstrates the company's ability to service its debt obligations without undue financial strain.
Peer comparison
Dec 31, 2024