ICU Medical Inc (ICUI)

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	65,866	27,825	30,208	16,314	36,960	44,412	26,020	14,844	-44,572	-24,685	20,087	55,695	124,105	128,324	123,843	110,425	103,749	96,886	96,134	102,270
Interest expense (ttm)	US$ in thousands	106,540	113,397	110,285	107,758	103,856	90,883	87,859	80,011	71,140	51,434	30,451	14,341	858	662	1,110	1,718	1,753	1,721	1,244	612
Interest coverage		0.62	0.25	0.27	0.15	0.36	0.49	0.30	0.19	-0.63	-0.48	0.66	3.88	144.64	193.84	111.57	64.28	59.18	56.30	77.28	167.11

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $65,866K ÷ $106,540K
= 0.62

The interest coverage ratio is a financial metric used to evaluate a company's ability to meet its interest payments on outstanding debt. It is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expense.

Based on the data provided for ICU Medical Inc, we observe fluctuations in the interest coverage ratio over the reported periods. The interest coverage ratio was strong and stable from March 31, 2020, to June 30, 2021, ranging from 167.11 to 111.57. This indicates the company's ability to comfortably cover its interest obligations during this time frame.

However, from September 30, 2021, onwards, we notice a significant decline in the interest coverage ratio, dropping to 3.88 on March 31, 2022, and even turning negative in subsequent periods. A decreasing interest coverage ratio suggests that ICU Medical Inc may be facing challenges in generating sufficient income to cover its interest payments, which could raise concerns about the company's financial health and debt obligations.

It is essential for investors and stakeholders to closely monitor ICU Medical Inc's interest coverage ratio to assess the company's ability to service its debt and manage its financial obligations effectively. Further analysis and investigation into the underlying reasons for the decline in the interest coverage ratio would be necessary to understand the company's financial performance and sustainability.