AZZ Incorporated (AZZ)

Interest coverage

Feb 29, 2024 Nov 30, 2023 Aug 31, 2023 May 31, 2023 Feb 28, 2023 Nov 30, 2022 Aug 31, 2022 May 31, 2022 Feb 28, 2022 Nov 30, 2021 Aug 31, 2021 May 31, 2021 Feb 28, 2021 Nov 30, 2020 Aug 31, 2020 May 31, 2020 Feb 29, 2020 Nov 30, 2019 Aug 31, 2019 May 31, 2019
Earnings before interest and tax (EBIT) (ttm) US$ in thousands 343,896 222,550 169,053 88,380 58,162 53,488 74,819 118,050 113,071 103,973 103,209 79,142 60,323 34,128 39,704 60,665 78,353 99,809 88,098 84,539
Interest expense (ttm) US$ in thousands 189,396 109,392 109,660 110,034 88,800 63,085 38,589 12,176 6,401 7,140 7,785 8,524 9,461 10,406 11,435 12,513 13,463 13,863 14,285 14,717
Interest coverage 1.82 2.03 1.54 0.80 0.65 0.85 1.94 9.70 17.66 14.56 13.26 9.28 6.38 3.28 3.47 4.85 5.82 7.20 6.17 5.74

February 29, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $343,896K ÷ $189,396K
= 1.82

Interest coverage ratio indicates the ability of AZZ Incorporated to meet its interest obligations from its operating income. Looking at the data provided, the interest coverage ratio has fluctuated over the periods.

In recent periods, such as Feb 29, 2024, and Nov 30, 2023, the interest coverage ratio improved significantly, indicating that the company's operating income was sufficient to cover its interest expenses more comfortably. This could be a positive sign of financial health.

However, in periods like May 31, 2023, and Feb 28, 2023, the interest coverage ratio was notably lower, suggesting that the company may have had difficulties in meeting its interest payments from its operating earnings during those times.

It is essential to note that an interest coverage ratio above 1 indicates that the company is generating enough income to cover interest expenses. An interest coverage ratio below 1 means that the company is not generating sufficient income to cover its interest payments, which could raise concerns about the company's financial stability and ability to service its debt.

In conclusion, the trend in AZZ Incorporated's interest coverage ratio shows variability, and it is crucial for investors and stakeholders to monitor this ratio over time to assess the company's ability to manage its debt obligations effectively.


Peer comparison

Feb 29, 2024

Company name
Symbol
Interest coverage
AZZ Incorporated
AZZ
1.82
Acuity Brands Inc
AYI
22.28