Blackbaud Inc (BLKB)

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 -278,684 179,688 168,106 125,403 103,397 21,372 -12,331 -16,976 -14,252 -9,540 3,286 11,898 22,748 27,197 24,347 31,419 35,074 40,863 41,747 38,469
Interest expense (ttm) US$ in thousands 55,634 48,604 44,084 39,536 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
Interest coverage -5.01 3.70 3.81 3.17 2.59 0.52 -0.30 -0.44 -0.40 -0.32 0.13 0.58 1.26 1.40 1.25 1.72 2.03 2.49 2.38 1.98

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-278,684K ÷ $55,634K
= -5.01

The interest coverage ratio is a measure of a company's ability to meet its interest obligations on outstanding debt. It is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expense. A higher interest coverage ratio indicates that the company is more capable of servicing its debt.

In the case of Blackbaud Inc, the interest coverage ratio fluctuated over the period from March 31, 2020, to December 31, 2024. It started at a relatively low level of 1.98 in March 2020, improved gradually, reaching its peak at 3.81 in June 2024, before experiencing a significant decline to -5.01 by December 2024. A negative interest coverage ratio typically indicates that the company's earnings are insufficient to cover its interest payments, raising concerns about its financial health.

Overall, the trend in Blackbaud Inc's interest coverage ratio shows variability and indicates potential challenges in meeting its interest obligations, especially towards the end of the period under consideration. Investors and creditors may view this trend as a red flag and may require further analysis of the company's financial position and future prospects.