Linde plc Ordinary Shares (LIN)
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 | 8,712,000 | 8,507,000 | 8,536,000 | 8,362,000 | 8,256,000 | 7,948,000 | 12,139,000 | 14,983,000 | 18,635,000 | 18,330,000 | 13,408,000 | 9,899,000 | 5,505,000 | 5,213,000 | 4,907,000 | 4,408,000 | 4,104,000 | 3,808,000 | 3,684,000 | 3,621,000 |
| Interest expense (ttm) | US$ in thousands | 487,000 | 274,000 | 246,000 | 228,000 | 200,000 | 160,000 | 138,000 | 91,000 | 63,000 | 63,000 | 53,000 | 66,000 | 77,000 | 81,000 | 111,000 | 111,000 | 115,000 | 88,000 | 53,000 | 45,000 |
| Interest coverage | 17.89 | 31.05 | 34.70 | 36.68 | 41.28 | 49.68 | 87.96 | 164.65 | 295.79 | 290.95 | 252.98 | 149.98 | 71.49 | 64.36 | 44.21 | 39.71 | 35.69 | 43.27 | 69.51 | 80.47 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $8,712,000K ÷ $487,000K
= 17.89
Linde plc's interest coverage ratio measures the company's ability to pay interest expenses on its debt obligations. A higher interest coverage ratio indicates that the company is more capable of servicing its debt with its operating income.
Looking at the historical trend of Linde plc's interest coverage ratio from March 31, 2020, to December 31, 2024, we observe fluctuations in the ratio over time. The interest coverage ratio was relatively strong in the beginning, standing at 80.47 on March 31, 2020, and decreasing gradually to a low point of 17.89 on December 31, 2024.
The company's interest coverage ratio dipped significantly between September 30, 2020, and March 31, 2021, indicating a potential strain on its ability to cover interest expenses with operating profits during that period. However, from June 30, 2021, onwards, the ratio started to improve steadily, reaching its peak at 295.79 on December 31, 2022.
The substantial increase in the interest coverage ratio from June 30, 2022, to December 31, 2022, reveals a significant enhancement in Linde plc's ability to cover interest expenses with its operating income. However, there was a notable decline in the ratio in the following periods, ending at 17.89 on December 31, 2024, which could indicate a potential strain on the company's ability to service its debt obligations.
Overall, the fluctuating trend of Linde plc's interest coverage ratio over the years suggests varying degrees of financial strength in terms of covering interest payments with operating profits. Analysts would need to further investigate the underlying reasons for the fluctuations to assess the company's overall financial health and debt repayment capability effectively.
Peer comparison
Dec 31, 2024
See also:
Linde plc Ordinary Shares Interest Coverage (Quarterly Data)