American States Water Company (AWR)

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	209,282	200,944	189,486	159,498	129,087	130,549	132,788	140,393	147,604	147,273	145,425	144,570	137,153	131,506	133,460	135,142	133,598	130,496	122,645	108,531
Interest expense (ttm)	US$ in thousands	42,762	39,681	35,321	30,902	27,027	24,237	22,459	22,182	22,834	22,841	23,449	22,739	22,531	23,241	23,359	24,319	24,586	24,392	24,061	23,827
Interest coverage		4.89	5.06	5.36	5.16	4.78	5.39	5.91	6.33	6.46	6.45	6.20	6.36	6.09	5.66	5.71	5.56	5.43	5.35	5.10	4.55

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $209,282K ÷ $42,762K
= 4.89

The interest coverage ratio for American States Water Co. has shown a consistent and healthy trend over the past eight quarters, ranging from 5.12 to 6.45. This indicates the company's ability to meet its interest obligations comfortably using its earnings before interest and taxes (EBIT). A higher interest coverage ratio suggests that the company is better positioned to cover its interest expenses and is less vulnerable to financial risk related to debt servicing. The consistent values above 5 signify a stable financial position and management's effective management of debt obligations. It is important for investors and stakeholders, as it reflects the company's ability to service its debt and indicates financial stability.