Black Hills Corporation (BKH)

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	472,700	466,193	447,901	456,774	455,244	439,196	449,590	444,467	409,429	421,405	413,766	413,433	428,303	423,711	412,028	399,096	406,042	398,810	393,344	408,894
Interest expense (ttm)	US$ in thousands	167,900	174,344	170,447	166,233	160,989	155,760	153,784	153,400	152,404	150,501	148,418	145,514	143,470	137,494	137,173	137,466	137,659	141,024	141,204	140,511
Interest coverage		2.82	2.67	2.63	2.75	2.83	2.82	2.92	2.90	2.69	2.80	2.79	2.84	2.99	3.08	3.00	2.90	2.95	2.83	2.79	2.91

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $472,700K ÷ $167,900K
= 2.82

Black Hills Corporation's interest coverage ratio has been fairly consistent over the past eight quarters, ranging from 2.65 to 2.92. The interest coverage ratio measures the company's ability to meet its interest obligations with its operating income.

The ratios above 1 indicate that Black Hills Corporation is generating enough operating income to cover its interest expenses. A higher ratio, such as the values consistently observed for the company, suggests a stronger ability to meet interest payments.

Although the interest coverage ratio has fluctuated slightly, staying above 2 for the most part indicates that Black Hills Corporation has been effectively managing its debt obligations and maintaining a healthy financial position.