Ichor Holdings Ltd (ICHR)

Interest coverage

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Earnings before interest and tax (EBIT) (ttm) US$ in thousands -11,699 14,055 51,665 80,015 86,386 84,123 72,667 72,516 80,207 78,461 69,450 53,559 41,018 32,762 23,837 17,540 14,922 15,445 23,712 46,803
Interest expense (ttm) US$ in thousands 19,379 18,928 17,041 14,074 11,056 8,298 6,536 6,064 6,451 6,996 7,561 8,272 8,727 9,182 9,793 10,253 10,647 10,820 10,710 10,251
Interest coverage -0.60 0.74 3.03 5.69 7.81 10.14 11.12 11.96 12.43 11.22 9.19 6.47 4.70 3.57 2.43 1.71 1.40 1.43 2.21 4.57

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-11,699K ÷ $19,379K
= -0.60

Ichor Holdings Ltd's interest coverage ratio has experienced fluctuations over the past few quarters. The interest coverage ratio measures the company's ability to pay its interest expenses on outstanding debt. A ratio below 1 indicates that the company is not generating enough operating income to cover its interest payments.

Looking at the trend, we observe that Ichor Holdings Ltd had a negative interest coverage ratio of -0.60 on Dec 31, 2023, which suggests that its operating income was insufficient to cover its interest expenses during that period. However, the ratio improved to 0.74 on Sep 30, 2023, indicating a slight increase in its ability to cover interest payments.

The trend continues to show improvement, with the interest coverage ratio steadily increasing in the subsequent quarters. This improvement culminated in a peak interest coverage ratio of 12.43 on Dec 31, 2021, indicating a strong ability to meet interest obligations.

Overall, it is important to monitor the interest coverage ratio of Ichor Holdings Ltd over time to assess its financial health and ability to service its debt obligations. fluctuations in this ratio may provide insights into the company's profitability and financial stability.