Cabot Corporation (CBT)
Interest coverage
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 572,000 | 507,000 | 367,000 | 422,000 | 6,000 |
| Interest expense | US$ in thousands | 81,000 | 90,000 | 56,000 | 49,000 | 53,000 |
| Interest coverage | 7.06 | 5.63 | 6.55 | 8.61 | 0.11 |
September 30, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $572,000K ÷ $81,000K
= 7.06
The interest coverage ratio for Cabot Corporation has shown fluctuations over the past five years, ranging from a low of 0.11 in 2020 to a high of 8.61 in 2021. This ratio measures the company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio indicates that the company is more capable of meeting its interest obligations from its earnings.
In 2024, Cabot Corporation's interest coverage ratio improved to 7.06, indicating an increase in the company's ability to cover its interest expenses. This suggests that the company's operating income has strengthened relative to its interest payments, which could be attributed to improved profitability, reduced interest costs, or a combination of both factors.
It is important to continue monitoring Cabot Corporation's interest coverage ratio in the future to ensure that the company remains financially healthy and capable of meeting its debt obligations.
Peer comparison
Sep 30, 2024