Altair Engineering Inc (ALTR)

Interest coverage

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	34,828	18,735	1,150	-16,579	-33,680	-23,836	-31,883	-6,830	13,046	11,777	13,413	12,822	17,509	13,630	11,240	3,962	5,877	9,759	1,738	14,507
Interest expense (ttm)	US$ in thousands	6,166	6,116	6,109	6,146	5,318	4,377	5,918	7,389	9,677	12,065	12,006	11,903	11,758	11,598	11,375	11,167	8,914	6,371	3,694	999
Interest coverage		5.65	3.06	0.19	-2.70	-6.33	-5.45	-5.39	-0.92	1.35	0.98	1.12	1.08	1.49	1.18	0.99	0.35	0.66	1.53	0.47	14.52

March 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $34,828K ÷ $6,166K
= 5.65

Altair Engineering Inc's interest coverage ratio has displayed significant fluctuations over the past few quarters. The interest coverage ratio measures the company's ability to cover its interest expenses with its operating income. A higher ratio indicates a company is more capable of meeting its interest obligations.

Looking at the data provided:
- The interest coverage ratio improved steadily from March 2020 to March 2021, reaching a high of 14.52, indicating a strong ability to cover interest expenses during this period.
- However, there was a sharp decline in interest coverage to negative levels in the subsequent quarters, indicating that the company's operating income was not sufficient to cover its interest expenses during those periods.
- By December 2023, the interest coverage ratio had improved to 3.06, showing a moderate recovery compared to the negative ratios seen in mid-2023.
- The most recent data as of March 2024 shows a further improvement in the interest coverage ratio to 5.65, indicating a better ability to meet interest payments with operating income compared to previous periods.

In conclusion, Altair Engineering Inc has experienced volatility in its interest coverage ratio, with periods of strong performance followed by significant declines that impacted its ability to cover interest expenses. The recent improvement in the interest coverage ratio suggests a positive trend in the company's ability to manage its interest obligations.