Brinks Company (BCO)
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 | ||
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Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 385,400 | 424,800 | 456,600 | 517,778 | 570,336 | 630,881 | 704,854 | 686,390 | 648,872 | 608,956 | 603,529 | 572,459 | 559,964 | 537,580 | 533,281 | 448,686 | 403,094 | 346,703 | 310,211 | 354,321 |
Interest expense (ttm) | US$ in thousands | 235,700 | 238,500 | 229,300 | 223,900 | 214,400 | 195,300 | 176,200 | 157,500 | 138,800 | 124,200 | 117,100 | 112,900 | 112,200 | 109,200 | 108,700 | 103,700 | 96,500 | 93,400 | 89,200 | 88,700 |
Interest coverage | 1.64 | 1.78 | 1.99 | 2.31 | 2.66 | 3.23 | 4.00 | 4.36 | 4.67 | 4.90 | 5.15 | 5.07 | 4.99 | 4.92 | 4.91 | 4.33 | 4.18 | 3.71 | 3.48 | 3.99 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $385,400K ÷ $235,700K
= 1.64
The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher ratio indicates stronger ability to meet interest obligations.
Based on the data provided for Brinks Company, there has been a gradual decline in the interest coverage ratio from 3.99 on March 31, 2020, to a low of 1.64 on December 31, 2024. This downward trend suggests that the company may be experiencing challenges in generating sufficient operating income to cover its interest expenses.
The peak interest coverage ratio of 5.15 on June 30, 2022, indicates a period of stronger financial health for Brinks Company. However, the subsequent decline in the ratio raises concerns about the company's ability to service its debt obligations. The decreasing trend in the interest coverage ratio may indicate increasing financial risk for the company, potentially leading to difficulties in meeting interest payments in the future.
It is important for investors and stakeholders to monitor the interest coverage ratio closely as a declining trend could signal financial distress and potentially impact the company's creditworthiness and overall financial stability. Management may need to implement strategies to improve profitability and enhance the company's ability to cover its interest expenses effectively.
Peer comparison
Dec 31, 2024