Chart Industries Inc (GTLS)
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 | 654,700 | 607,600 | 519,700 | 447,800 | 344,300 | 245,100 | 195,100 | 122,500 | 130,700 | 104,000 | 83,300 | 72,500 | 88,300 | 86,600 | 99,600 | 131,000 | 117,000 | 126,900 | 112,500 | 103,900 |
| Interest expense (ttm) | US$ in thousands | 328,500 | 335,100 | 340,200 | 335,400 | 277,100 | 206,200 | 126,200 | 51,100 | 28,800 | 16,600 | 14,100 | 11,900 | 10,700 | 10,900 | 14,200 | 19,500 | 24,700 | 28,000 | 29,300 | 27,200 |
| Interest coverage | 1.99 | 1.81 | 1.53 | 1.34 | 1.24 | 1.19 | 1.55 | 2.40 | 4.54 | 6.27 | 5.91 | 6.09 | 8.25 | 7.94 | 7.01 | 6.72 | 4.74 | 4.53 | 3.84 | 3.82 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $654,700K ÷ $328,500K
= 1.99
The interest coverage ratio for Chart Industries Inc has shown fluctuations over the years, reflecting the company's ability to meet its interest obligations. The ratio has generally remained above 3, indicating that the company's operating income has been sufficient to cover its interest expenses.
From March 31, 2020, to December 31, 2021, the interest coverage ratio demonstrated a positive trend, steadily increasing from 3.82 to 8.25. This improvement suggests that the company's profitability and cash flow were robust during this period, providing a healthy buffer to cover interest payments.
However, starting from March 31, 2022, the interest coverage ratio experienced a decline, dropping to 2.40 by March 31, 2023. This significant decrease may raise concerns about the company's ability to cover its interest expenses with its operating income during that period.
Between March 31, 2023, and December 31, 2024, the interest coverage ratio continued to decrease, hitting a low of 1.19 on September 30, 2023. This downward trend indicates potential financial stress for the company as its operating income may not have been sufficient to cover its interest obligations adequately.
The declining trend in the interest coverage ratio warrants further investigation into Chart Industries Inc's financial performance, profitability, and debt obligations to assess the company's long-term financial sustainability and ability to service its debt in the future.