Inter Parfums Inc (IPAR)

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	266,427	251,759	221,869	207,226	225,724	226,105	205,327	194,707	167,718	140,142	141,826	140,903	131,228	159,506	128,041	84,508	59,569	49,340	55,070	79,012
Interest expense (ttm)	US$ in thousands	8,901	11,025	11,444	10,703	11,253	8,040	6,325	5,072	3,598	2,069	3,084	3,331	2,825	3,804	2,255	1,346	1,970	2,442	2,678	2,520
Interest coverage		29.93	22.84	19.39	19.36	20.06	28.12	32.46	38.39	46.61	67.73	45.99	42.30	46.45	41.93	56.78	62.78	30.24	20.20	20.56	31.35

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $266,427K ÷ $8,901K
= 29.93

Inter Parfums Inc's interest coverage ratio, which measures the company's ability to meet its interest obligations with its operating income, fluctuated over the period from March 31, 2020, to December 31, 2024.

The interest coverage ratio started at a relatively high level of 31.35 on March 31, 2020, indicating a strong ability to cover interest expenses. This ratio decreased to 20.56 by June 30, 2020, before remaining relatively stable around the range of 20 to 30 for the rest of 2020 and early 2021.

From March 31, 2021, the interest coverage ratio improved significantly, reaching a peak of 67.73 on September 30, 2022, signaling a substantial increase in the company's ability to cover interest costs with operating income. However, the ratio declined from this peak, settling around 20 to 40 for the period from September 30, 2022, to December 31, 2024.

The declining trend in the interest coverage ratio towards the end of the period might indicate potential challenges in generating sufficient operating income to cover interest expenses. It is essential for stakeholders to monitor this ratio closely to ensure that Inter Parfums Inc can meet its interest obligations effectively in the future.