LCI Industries (LCII)

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	148,215	150,836	196,426	160,996	123,428	97,770	139,702	271,417	521,075	545,766	547,268	454,361	286,091	347,890	353,299	280,099	222,934	197,126	151,846	196,721
Interest expense (ttm)	US$ in thousands	28,899	33,255	37,064	39,351	40,424	39,188	35,773	31,715	27,573	24,875	22,632	19,913	16,366	13,454	10,735	10,961	13,453	13,133	13,085	11,486
Interest coverage		5.13	4.54	5.30	4.09	3.05	2.49	3.91	8.56	18.90	21.94	24.18	22.82	17.48	25.86	32.91	25.55	16.57	15.01	11.60	17.13

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $148,215K ÷ $28,899K
= 5.13

The interest coverage ratio of LCI Industries, calculated as EBIT (earnings before interest and taxes) divided by interest expense, indicates the company's ability to meet its interest obligations with its operating earnings.

Based on the provided data, we observe fluctuations in LCI Industries' interest coverage over the period from March 31, 2020, to December 31, 2024. The interest coverage ratio ranged from a high of 32.91 on June 30, 2021, to a low of 2.49 on September 30, 2023.

Generally, a higher interest coverage ratio suggests that the company is more capable of servicing its debt payments using its earnings. In this case, LCI Industries maintained relatively healthy interest coverage levels in the earlier years of the data provided, with ratios consistently above 15. However, there was a notable decline in the ratio from March 31, 2023, to September 30, 2024, indicating a potential strain on the company's ability to cover its interest expenses with operating income during that period.

It is important for investors and stakeholders to closely monitor LCI Industries' interest coverage ratio over time to assess the company's financial health and ability to meet its debt obligations. Fluctuations in this ratio can indicate changes in the company's profitability and risk profile.