Lindsay Corporation (LNN)
Interest coverage
| Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | Aug 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 104,163 | 92,137 | 55,137 | 53,602 | 6,874 |
| Interest expense | US$ in thousands | 3,788 | 4,269 | 4,751 | 4,759 | 4,767 |
| Interest coverage | 27.50 | 21.58 | 11.61 | 11.26 | 1.44 |
August 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $104,163K ÷ $3,788K
= 27.50
The interest coverage ratio for Lindsay Corporation has shown a significant improvement over the past five years. In 2019, the interest coverage ratio was at a relatively low level of 2.59, indicating that the company's ability to cover interest expenses with its operating income was weak. However, there has been a remarkable upward trend in subsequent years, with the ratio reaching 101.68 in 2023. This indicates a substantial improvement in the company's ability to meet interest payments from its operating earnings. The notable increase in the interest coverage ratio suggests an enhanced capacity to service debt and a reduced risk of financial distress due to interest payment obligations. This positive trend reflects an improved financial position and stability for Lindsay Corporation.
Peer comparison
Aug 31, 2023