Estee Lauder Companies Inc (EL)

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 970,000 1,509,000 3,170,000 2,618,000 1,195,000
Interest expense US$ in thousands 378,000 255,000 167,000 173,000 161,000
Interest coverage 2.57 5.92 18.98 15.13 7.42

June 30, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $970,000K ÷ $378,000K
= 2.57

The interest coverage ratio for Estee Lauder Companies Inc has fluctuated over the past five years. In 2024, the interest coverage ratio was 2.57, indicating that the company earned 2.57 times the amount of interest expenses it had to pay. This represents a decrease compared to the previous year, when the ratio was 5.92.

Although the interest coverage ratio in 2024 has declined, it is important to note that the company's ability to cover its interest expenses remains satisfactory and above the industry average. In 2022, Estee Lauder had a high interest coverage ratio of 18.98, suggesting a strong ability to meet its interest obligations.

Overall, the trend in Estee Lauder's interest coverage ratio highlights some fluctuations, but the company has generally demonstrated a solid capacity to cover its interest expenses in recent years. Continued monitoring of this ratio will be important to assess the company's financial health and its ability to manage debt obligations.


Peer comparison

Jun 30, 2024


See also:

Estee Lauder Companies Inc Interest Coverage