Harmony Biosciences Holdings (HRMY)

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
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	195,113	179,582	182,381	207,927	192,030	199,447	146,839	133,053	120,186	101,204	110,356	100,552	87,529	66,656	55,983
Interest expense (ttm)	US$ in thousands	17,496	18,083	20,747	22,561	23,757	24,405	22,324	20,290	18,795	17,602	18,160	21,255	17,683	14,824	16,330
Interest coverage		11.15	9.93	8.79	9.22	8.08	8.17	6.58	6.56	6.39	5.75	6.08	4.73	4.95	4.50	3.43

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $195,113K ÷ $17,496K
= 11.15

Harmony Biosciences Holdings has demonstrated a consistent and improving trend in its interest coverage ratio over the analyzed period. The interest coverage ratio, which indicates the company's ability to meet its interest obligations, has increased steadily from 3.43 in June 30, 2021, to 11.15 in December 31, 2024. This indicates that the company's earnings before interest and taxes (EBIT) are more than sufficient to cover its interest expenses.

The significant improvement in the interest coverage ratio reflects the company's enhanced profitability and financial strength over time. With the ratio consistently above 1, Harmony Biosciences Holdings has a comfortable cushion to meet its interest payments. The upward trend also suggests that the company's financial health is stable and improving, which bodes well for its ability to handle debt obligations and withstand financial challenges in the future.

Overall, the strong and improving interest coverage ratio of Harmony Biosciences Holdings demonstrates its solid financial position and ability to manage its interest expenses effectively, which is a positive indicator for investors and stakeholders.