Broadridge Financial Solutions Inc (BR)

Interest coverage

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	1,017,100	936,400	759,900	678,700	624,900
Interest expense	US$ in thousands	150,200	143,700	87,700	57,500	62,500
Interest coverage		6.77	6.52	8.66	11.80	10.00

June 30, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $1,017,100K ÷ $150,200K
= 6.77

Broadridge Financial Solutions Inc has displayed a consistent trend of solid interest coverage over the past five years. The interest coverage ratio measures the company's ability to meet its interest payments on outstanding debt. Broadridge's interest coverage ratio has remained comfortably above 1, indicating that the company generates sufficient operating income to cover its interest expenses.

The trend of the interest coverage ratio shows a slight decline over the years, from 11.80 in 2021 to 6.77 in 2024. Although the ratio has decreased, it still remains at a healthy level, indicating that Broadridge's earnings are sufficient to cover its interest obligations.

A high interest coverage ratio suggests that the company is at lower risk of defaulting on its debt payments, as it has a cushion to absorb any fluctuations in earnings. Broadridge's interest coverage ratios ranging from 6.52 to 11.80 demonstrate the company's financial stability and ability to manage its debt obligations effectively.

Overall, Broadridge Financial Solutions Inc's interest coverage ratios reflect a company with a sound financial footing and the ability to manage its debt comfortably.