Broadridge Financial Solutions Inc (BR)

Interest coverage

		Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Earnings before interest and tax (EBIT)	US$ in thousands	—	1,027,600	936,400	759,900	678,600
Interest expense	US$ in thousands	122,700	150,200	143,700	87,700	57,500
Interest coverage		0.00	6.84	6.52	8.66	11.80

June 30, 2025 calculation

Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $122,700K
= 0.00

The interest coverage ratio of Broadridge Financial Solutions Inc. over the specified periods demonstrates significant fluctuation, reflecting changes in the company's ability to meet its interest obligations with its earnings. As of June 30, 2021, the interest coverage stood at 11.80, indicating a strong capacity to cover interest expenses, with earnings substantially exceeding interest costs, which generally signifies a healthy financial position.

By June 30, 2022, the ratio declined to 8.66, still maintaining a robust coverage level, though it suggests some reduction in earnings relative to interest expenses compared to the previous year. This downward trend continued into June 30, 2023, where the ratio further decreased to 6.52, indicating continued but manageable compression in interest coverage.

Looking ahead to June 30, 2024, the ratio marginally increased to 6.84, implying a slight improvement or stabilization in the company's earnings ability to cover interest obligations. However, by June 30, 2025, the interest coverage ratio is projected to be 0.00, which signifies that the company's forecasted or managed earnings are anticipated to be insufficient to cover interest expenses at that point, indicating a critical deterioration in interest coverage.

Overall, the trend from 2021 through 2024 suggests a weakening of Broadridge's capacity to cover its interest liabilities from earnings, with the ratio remaining well above the typical threshold of 1.5 to 2.0 throughout the earlier years, thus reflecting sound financial health. The projected collapse to zero in 2025 warrants close examination, as it indicates potential challenges in meeting interest obligations unless remedial measures or earnings improvements are undertaken.