Avery Dennison Corp (AVY)
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 | 1,095,700 | 1,086,200 | 1,078,800 | 962,100 | 889,800 | 820,400 | 852,200 | 988,800 | 1,083,400 | 1,155,700 | 1,104,400 | 1,067,000 | 1,063,000 | 1,065,200 | 1,048,600 | 900,600 | 819,900 | 768,300 | 748,100 | 833,000 |
| Interest expense (ttm) | US$ in thousands | 117,000 | 117,500 | 118,500 | 121,200 | 119,000 | 111,800 | 102,000 | 90,900 | 84,100 | 81,600 | 78,400 | 73,600 | 70,200 | 65,800 | 63,400 | 67,400 | 70,000 | 72,200 | 75,600 | 75,100 |
| Interest coverage | 9.36 | 9.24 | 9.10 | 7.94 | 7.48 | 7.34 | 8.35 | 10.88 | 12.88 | 14.16 | 14.09 | 14.50 | 15.14 | 16.19 | 16.54 | 13.36 | 11.71 | 10.64 | 9.90 | 11.09 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,095,700K ÷ $117,000K
= 9.36
Based on the provided data, the interest coverage ratio of Avery Dennison Corp has shown some fluctuations over the reported periods. The interest coverage ratio represents the company's ability to cover its interest expenses with its operating income.
The interest coverage ratio for Avery Dennison Corp ranged from a low of 7.34 in September 30, 2023, to a high of 16.54 in June 30, 2021. This indicates that the company's ability to cover its interest expenses improved significantly in the second quarter of 2021, reaching its peak during that period.
However, the interest coverage ratio has generally shown a decreasing trend from 2022 to 2024, with some fluctuations in between. The ratio declined from 14.50 in March 31, 2022, to 9.36 in December 31, 2024. This downward trend may suggest a potential concern regarding the company's ability to cover its interest obligations with its operating income.
Overall, while Avery Dennison Corp's interest coverage ratio has fluctuated over the reported periods, it is essential for stakeholders to monitor the trend closely to assess the company's financial health and its ability to manage its interest expenses effectively.
Peer comparison
Dec 31, 2024