Blackbaud Inc (BLKB)
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 | 57,566 | 7,295 | -22,969 | -22,854 | -19,772 | -11,015 | 4,251 | 14,594 | 25,086 | 30,438 | 28,359 | 35,041 | 38,901 | 43,458 | 42,870 | 38,330 | 31,203 | 43,503 | 49,098 | 45,146 |
| Interest expense (ttm) | US$ in thousands | 39,922 | 41,340 | 41,057 | 38,866 | 35,803 | 29,744 | 24,410 | 20,488 | 18,003 | 19,409 | 19,403 | 18,242 | 17,287 | 16,434 | 17,548 | 19,454 | 20,618 | 20,171 | 19,200 | 17,704 |
| Interest coverage | 1.44 | 0.18 | -0.56 | -0.59 | -0.55 | -0.37 | 0.17 | 0.71 | 1.39 | 1.57 | 1.46 | 1.92 | 2.25 | 2.64 | 2.44 | 1.97 | 1.51 | 2.16 | 2.56 | 2.55 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $57,566K ÷ $39,922K
= 1.44
The interest coverage ratio measures a company's ability to meet its interest obligations. A ratio below 1 indicates that the company is not generating enough operating income to cover its interest expenses.
Based on the data provided for Blackbaud Inc, the interest coverage ratio has fluctuated significantly over the past eight quarters. In Q4 2023, the interest coverage ratio was 1.44, indicating that the company's operating income was sufficient to cover its interest expenses. However, in the previous quarters, the ratio was negative, with Q3 2023 showing the lowest figure at -0.08.
The negative interest coverage ratios in Q3 2023, Q2 2023, Q1 2023, Q4 2022, and Q3 2022 suggest that Blackbaud Inc did not have enough operating income to cover its interest payments during those periods. This raises concerns about the company's ability to meet its interest obligations and may indicate financial distress.
It is essential for Blackbaud Inc to closely monitor its interest coverage ratio and take proactive measures to improve its financial performance and ensure it can meet its debt obligations in the long term.
Peer comparison
Dec 31, 2023