American States Water Company (AWR)

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 192,507 193,200 190,935 198,028 209,282 200,944 189,486 159,498 129,087 130,549 132,788 140,393 147,604 147,273 145,425 144,570 137,153 131,506 133,460 135,142
Interest expense (ttm) US$ in thousands 50,382 50,079 48,545 46,136 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
Interest coverage 3.82 3.86 3.93 4.29 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

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $192,507K ÷ $50,382K
= 3.82

The interest coverage ratio of American States Water Company has shown a consistent trend of improvement from March 31, 2020, to September 30, 2021, with values ranging from 5.56 to 6.45. This indicates that the company's operating income was sufficient to cover its interest expense during this period. However, from December 31, 2021, to December 31, 2024, there was a gradual decline in the interest coverage ratio, dropping to 3.82 by the end of December 2024. This downward trend suggests that the company may be facing challenges in generating enough operating income to cover its interest obligations, potentially indicating increased financial risk. It would be important for stakeholders to monitor this ratio closely to assess the company's ability to meet its debt service requirements in the future.