Charles River Laboratories (CRL)

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 233,860 641,929 670,507 680,140 712,248 749,870 737,230 722,418 675,896 570,831 575,480 571,225 546,765 578,401 594,850 555,703 532,545 457,733 381,483 357,660
Interest expense (ttm) US$ in thousands 126,288 131,598 135,056 137,331 136,710 137,945 115,578 84,237 59,291 36,058 41,138 53,625 73,910 95,511 97,923 101,085 86,433 77,648 64,479 65,962
Interest coverage 1.85 4.88 4.96 4.95 5.21 5.44 6.38 8.58 11.40 15.83 13.99 10.65 7.40 6.06 6.07 5.50 6.16 5.89 5.92 5.42

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $233,860K ÷ $126,288K
= 1.85

The interest coverage ratio for Charles River Laboratories has shown fluctuation over the past few years. It increased steadily from around 5.42 in March 2020 to a peak of 15.83 in September 2022, indicating a strong ability to cover interest payments with operating income. However, the ratio started to decline from that point onwards, possibly indicating a decline in earnings relative to interest expenses.

By December 2024, the interest coverage ratio fell to 1.85, which is a significant decrease from the peak levels seen in 2022. This may raise concerns about Charles River Laboratories' ability to meet its interest obligations with its current level of operating income.

Overall, the trend in interest coverage ratios suggests that Charles River Laboratories had a period of strong financial health but is now facing challenges in maintaining the same level of interest coverage. Further analysis of the company's financial performance and debt structure would be necessary to understand the reasons behind this decline.