Embecta Corp (EMBC)

Interest coverage

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	178,200	221,500	103,700	149,500	192,700	220,500
Interest expense (ttm)	US$ in thousands	8,800	8,800	6,100	1,500	4,800	11,600
Interest coverage		20.25	25.17	17.00	99.67	40.15	19.01

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $178,200K ÷ $8,800K
= 20.25

The interest coverage ratio measures a company's ability to pay its interest expense on outstanding debt. A higher interest coverage ratio indicates a stronger ability to meet interest obligations.

Looking at the trend in Embecta Corp's interest coverage ratio over the past six quarters, we can see fluctuations in the company's ability to cover its interest expenses. The interest coverage ratio reached its lowest point in June 2023 at 17.00, indicating a slight decrease in the company's ability to cover interest payments. However, in the following quarter (September 2023), the ratio increased significantly to 25.17, demonstrating a stronger ability to cover interest expenses.

Overall, Embecta Corp's interest coverage ratio has shown variability, with some quarters indicating a very strong ability to cover interest payments (e.g., March 2023 with a ratio of 99.67) while others showing a lower coverage level (e.g., June 2023 at 17.00). It would be important for stakeholders to monitor this ratio closely to ensure the company can continue to meet its interest obligations effectively.