Hexcel Corporation (HXL)

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	186,100	224,800	215,900	205,400	215,300	208,200	205,400	207,900	175,200	157,700	139,700	92,100	51,800	6,500	-53,800	-63,900	12,500	133,000	280,000	390,300
Interest expense (ttm)	US$ in thousands	31,200	30,700	30,000	31,100	34,000	35,600	36,800	36,500	36,200	36,200	36,700	37,100	38,300	38,500	38,700	40,100	41,800	43,000	44,300	45,500
Interest coverage		5.96	7.32	7.20	6.60	6.33	5.85	5.58	5.70	4.84	4.36	3.81	2.48	1.35	0.17	-1.39	-1.59	0.30	3.09	6.32	8.58

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $186,100K ÷ $31,200K
= 5.96

Hexcel Corporation's interest coverage ratio has fluctuated significantly over the reporting periods. The interest coverage ratio indicates the company's ability to meet its interest obligations from its operating income. From March 31, 2020, to June 30, 2022, the interest coverage ratio steadily decreased from 8.58 to 3.81, indicating a potential decline in the company's ability to cover its interest payments.

However, starting from September 30, 2022, the interest coverage ratio began to improve, reaching a peak of 7.32 on September 30, 2024, before slightly decreasing to 5.96 on December 31, 2024. This upward trend indicates that Hexcel Corporation's operating income was able to more comfortably cover its interest expenses during this period.

Overall, the company's interest coverage ratio demonstrates some volatility, with periods of improvement and decline. Investors and creditors should continue to monitor this ratio to gauge the company's financial health and its ability to meet its debt obligations.