Insteel Industries Inc (IIIN)
Interest coverage
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 25,376 | 41,842 | 161,818 | 86,199 | 24,276 |
| Interest expense | US$ in thousands | 89 | 87 | 91 | 96 | 106 |
| Interest coverage | 285.12 | 480.94 | 1,778.22 | 897.91 | 229.02 |
September 30, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $25,376K ÷ $89K
= 285.12
Insteel Industries Inc's interest coverage ratio has exhibited significant fluctuations over the past five years. The ratio stood at 285.12 in 2024, reflecting a decline from the previous year's exceptionally high figure of 480.94. This decrease indicates that the company's ability to cover its interest expenses with operating income deteriorated during the period.
Furthermore, the interest coverage ratio in 2024 is substantially lower compared to the exceptional performance in 2022, where the ratio soared to 1,778.22. This exceptional level of coverage suggests a substantial improvement in the company's ability to meet interest obligations with its operating income.
In contrast, in 2021 and 2020, Insteel Industries Inc's interest coverage ratios were 897.91 and 229.02, respectively. These figures indicate a moderate to low ability to cover interest expenses with operating income, with the ratio in 2020 being the lowest among the five years analyzed.
Overall, the fluctuations in Insteel Industries Inc's interest coverage ratio over the past five years suggest varying levels of financial risk and operational performance. It is crucial for stakeholders to monitor this ratio closely to assess the company's ability to honor its debt obligations and sustain its financial health.
Peer comparison
Sep 30, 2024