Kadant Inc (KAI)
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 | 171,537 | 174,121 | 168,921 | 163,681 | 166,677 | 166,223 | 161,390 | 155,716 | 171,312 | 163,645 | 153,214 | 148,606 | 116,035 | 106,415 | 99,118 | 84,251 | 80,567 | 74,196 | 77,370 | 82,363 |
| Interest expense (ttm) | US$ in thousands | 20,028 | 17,062 | 13,653 | 10,697 | 8,398 | 8,879 | 8,493 | 7,614 | 6,478 | 5,645 | 5,244 | 4,944 | 4,821 | 4,860 | 5,210 | 6,075 | 7,423 | 8,672 | 10,068 | 11,710 |
| Interest coverage | 8.56 | 10.21 | 12.37 | 15.30 | 19.85 | 18.72 | 19.00 | 20.45 | 26.45 | 28.99 | 29.22 | 30.06 | 24.07 | 21.90 | 19.02 | 13.87 | 10.85 | 8.56 | 7.68 | 7.03 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $171,537K ÷ $20,028K
= 8.56
The interest coverage ratio for Kadant Inc has shown a generally positive trend over the past few years, indicating the company's ability to meet its interest obligations comfortably. The ratio increased from 7.03 in March 2020 to a peak of 30.06 in March 2022, demonstrating a significant improvement in the company's capacity to cover its interest expenses.
However, after reaching its peak, the interest coverage ratio started to decline gradually, dropping to 15.30 in March 2024. This downward trend suggests a potential decrease in Kadant Inc's ability to cover its interest payments from its operating income.
It is important for stakeholders to monitor this ratio closely to ensure that Kadant Inc maintains a healthy level of interest coverage, as a lower ratio could indicate financial distress or an increased risk of default on its debt obligations. Further analysis of the company's financial performance and debt management strategies may be necessary to understand the reasons behind the fluctuations in the interest coverage ratio.
Peer comparison
Dec 31, 2024