Coty Inc (COTY)
Interest coverage
| Jun 30, 2025 | Mar 31, 2025 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | -79,100 | -131,500 | 329,600 | 456,400 | 487,400 | 671,900 | 637,400 | 592,700 | 538,000 | 163,900 | 178,500 | 235,200 | 100,500 | 314,900 | 272,200 | 227,900 | 125,400 | -651,000 | -945,500 | -1,269,900 |
| Interest expense (ttm) | US$ in thousands | 227,000 | 231,600 | 240,200 | 245,200 | 251,600 | 260,600 | 267,000 | 270,300 | 261,100 | 243,600 | 239,300 | 236,000 | 241,200 | 245,900 | 236,700 | 235,600 | 231,800 | 194,100 | 201,100 | 194,100 |
| Interest coverage | -0.35 | -0.57 | 1.37 | 1.86 | 1.94 | 2.58 | 2.39 | 2.19 | 2.06 | 0.67 | 0.75 | 1.00 | 0.42 | 1.28 | 1.15 | 0.97 | 0.54 | -3.35 | -4.70 | -6.54 |
June 30, 2025 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-79,100K ÷ $227,000K
= -0.35
The interest coverage ratio for Coty Inc. exhibits a notable evolution over the period analyzed. During the fiscal year ending September 30, 2020, the ratio is markedly negative at -6.54, indicating substantial difficulty in meeting interest obligations, likely due to negative earnings or impaired cash flows. This negative trend persists into December 2020 and March 2021, with ratios of -4.70 and -3.35 respectively, maintaining a pattern of insufficient earnings to cover interest expenses.
A significant turning point occurs in June 2021, when the ratio turns positive at 0.54, suggesting improved, albeit still modest, ability to meet interest obligations. This upward trend continues into September 2021 with a ratio of 0.97, and further into December 2021 with a ratio of 1.15, indicating that the company's earnings are now just sufficient to cover interest expenses. The ratio remains above 1 in March 2022 at 1.28, implying a better capacity to service interest costs adequately.
However, the ratio demonstrates some volatility thereafter, declining to 0.42 in June 2022 and reverting briefly to 1.00 in September 2022 before declining again to 0.75 in December 2022 and 0.67 in March 2023. These fluctuations suggest initial periods where earnings were insufficient or only barely sufficient to cover interest payments.
The significant improvement resumes in June 2023 with a ratio of 2.06 and continues into September 2023 at 2.19, indicating a comfortable buffer over interest obligations. The trend persists into December 2023 and March 2024, with ratios of 2.39 and 2.58 respectively, reflecting a strengthening capacity to cover interest expenses through earnings.
Subsequently, a decline is observed in the following quarters, with ratios of 1.94 in June 2024 and 1.86 in September 2024, still above 1 but indicating some weakening. By December 2024, the ratio diminishes further to 1.37, maintaining a positive but reduced coverage level.
The projected data for the first half of 2025 shows a reversal with interest coverage ratios becoming negative again at -0.57 in March 2025 and -0.35 in June 2025, signaling a deterioration in the company's ability to meet its interest obligations solely through earnings. This decline suggests increased financial stress and potential challenges in maintaining interest payments without additional financing or restructuring.
Peer comparison
Jun 30, 2025