AdvanSix Inc (ASIX)

Interest coverage

		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	Mar 31, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	72,943	126,535	149,331	191,152	229,021	214,796	259,699	232,511	187,650	189,351	130,040	85,816	60,661	26,976	38,076	45,024	59,785	110,967	90,633	91,633
Interest expense (ttm)	US$ in thousands	3,790	3,447	3,434	3,419	3,260	2,611	2,604	2,604	2,598	5,613	5,616	5,621	5,628	6,416	6,423	6,427	6,430	1,323	2,575	4,157
Interest coverage		19.25	36.71	43.49	55.91	70.25	82.27	99.73	89.29	72.23	33.73	23.16	15.27	10.78	4.20	5.93	7.01	9.30	83.88	35.20	22.04

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $72,943K ÷ $3,790K
= 19.25

AdvanSix Inc's interest coverage ratio has shown strong and consistent performance over the past eight quarters. The interest coverage ratio measures the company's ability to meet its interest payments on outstanding debt with its earnings before interest and taxes (EBIT).

In Q4 2023, the interest coverage ratio was 9.29, indicating that the company's EBIT was 9.29 times higher than its interest expenses for the quarter. This ratio has been steadily increasing since Q1 2022, where it stood at 57.94.

The significant improvement in interest coverage ratio from Q1 2022 to Q4 2023, reaching a high of 54.49 in Q1 2023, reflects AdvanSix Inc's strengthening financial position and ability to easily cover its interest obligations. The consistent increase in the ratio indicates that the company has been effectively managing its debt and/or generating higher earnings.

Overall, AdvanSix Inc's interest coverage ratio demonstrates a healthy financial position and strong ability to service its debt obligations with its operating earnings. This trend is a positive indication of the company's financial stability and ability to weather potential financial challenges.