Iridium Communications Inc (IRDM)

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 63,777 54,105 43,824 80,594 76,679 68,580 65,735 56,531 46,314 40,740 38,444 32,677 35,483 30,384 25,662 23,575 10,120 9,977 7,977 20,581
Interest expense (ttm) US$ in thousands 14,700 35,714 84,165 78,125 72,092 62,876 61,494 64,363 72,860 84,662 89,800 94,500 98,600 107,900 120,000 131,600 140,100 144,600 147,400 150,000
Interest coverage 4.34 1.51 0.52 1.03 1.06 1.09 1.07 0.88 0.64 0.48 0.43 0.35 0.36 0.28 0.21 0.18 0.07 0.07 0.05 0.14

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $63,777K ÷ $14,700K
= 4.34

The interest coverage ratio for Iridium Communications Inc has been showing some fluctuations over the past eight quarters. The ratio indicates the company's ability to meet its interest payments on its outstanding debt obligations.

In Q4 2023, the interest coverage ratio was at 0.84, which suggests that the company's earnings before interest and taxes (EBIT) could cover its interest expenses 0.84 times. This is a decrease from the previous quarter in Q3 2023 when the ratio was 0.55, indicating a potential weakening in the company's ability to meet its interest obligations.

The trend continues with Q2 2023 and Q1 2023, where the interest coverage ratios were 0.56 and 1.16, respectively. The improvement seen in Q1 2023 could be a positive sign for investors and creditors, showing that the company's earnings were more comfortably covering its interest expenses.

Looking back at Q4 2022, the interest coverage ratio was 1.16, which was the same as Q1 2023, indicating consistency in the company's ability to cover its interest payments.

Overall, the fluctuations in the interest coverage ratio for Iridium Communications Inc over the past eight quarters suggest some variability in the company's ability to meet its interest obligations using its earnings before interest and taxes. It would be important to monitor this ratio closely to assess the company's financial health and its ability to service its debt in the future.


Peer comparison

Dec 31, 2023

Company name
Symbol
Interest coverage
Iridium Communications Inc
IRDM
4.34
ESCO Technologies Inc
ESE
9.55
Lumentum Holdings Inc
LITE
-26.25