CSW Industrials Inc (CSWI)
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 | 181,095 | 170,653 | 163,489 | 153,605 | 149,363 | 152,585 | 144,023 | 139,191 | 127,583 | 117,229 | 107,803 | 95,097 | 78,457 | 69,961 | 65,850 | 53,494 | 49,284 | 56,247 | 54,549 | 58,931 |
| Interest expense (ttm) | US$ in thousands | 6,504 | 9,269 | 11,234 | 12,723 | 14,187 | 15,622 | 15,422 | 13,197 | 10,388 | 7,372 | 5,696 | 5,450 | 5,464 | 4,749 | 3,603 | 2,383 | 1,316 | 1,133 | 1,148 | 1,331 |
| Interest coverage | 27.84 | 18.41 | 14.55 | 12.07 | 10.53 | 9.77 | 9.34 | 10.55 | 12.28 | 15.90 | 18.93 | 17.45 | 14.36 | 14.73 | 18.28 | 22.45 | 37.45 | 49.64 | 47.52 | 44.28 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $181,095K ÷ $6,504K
= 27.84
CSW Industrials Inc's interest coverage ratio has shown some fluctuations over the period under review. The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher ratio indicates a stronger ability to meet interest obligations.
From March 31, 2020, to September 30, 2021, the interest coverage ratio steadily increased from 44.28 to 49.64, indicating a strong ability to cover interest expenses. However, from March 31, 2021, the ratio started to decline significantly, dropping to 10.55 by March 31, 2023.
This decreasing trend in the interest coverage ratio from 2021 to 2023 may indicate a potential concern regarding the company's ability to cover its interest payments with operating income. Furthermore, the ratio remained below 15 in the last quarters of 2023, suggesting a higher financial risk associated with servicing debt obligations.
The subsequent improvement in the interest coverage ratio from March 31, 2023, to December 31, 2024, reaching 27.84, indicates a positive trend. This increase suggests a stronger ability to cover interest expenses with operating income in the last quarter of 2024 compared to the lower points in the previous years.
Overall, the company should continue monitoring its interest coverage ratio closely to ensure it maintains a healthy level of coverage and does not face financial distress due to high interest expenses relative to its operating income.
Peer comparison
Dec 31, 2024