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