MDU Resources Group Inc (MDU)
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 | 590,450 | 665,246 | 717,255 | 597,387 | 577,010 | 462,895 | 485,941 | 537,475 | 561,035 | 589,774 | 602,747 | 604,190 | 571,313 | 546,291 | 531,898 | 481,326 | 497,320 | 479,345 | 427,921 | 405,633 |
| Interest expense (ttm) | US$ in thousands | 128,375 | 157,606 | 145,673 | 138,401 | 125,641 | 88,403 | 91,596 | 95,790 | 93,983 | 93,610 | 93,982 | 95,419 | 96,519 | 97,625 | 99,122 | 99,733 | 98,587 | 96,506 | 92,203 | 87,574 |
| Interest coverage | 4.60 | 4.22 | 4.92 | 4.32 | 4.59 | 5.24 | 5.31 | 5.61 | 5.97 | 6.30 | 6.41 | 6.33 | 5.92 | 5.60 | 5.37 | 4.83 | 5.04 | 4.97 | 4.64 | 4.63 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $590,450K ÷ $128,375K
= 4.60
The interest coverage ratio for MDU Resources Group Inc has shown some fluctuations over the past eight quarters. The ratio has remained above 3 in all periods, indicating that the company's earnings before interest and taxes (EBIT) are sufficient to cover its interest expenses.
In Q1 2022, the interest coverage ratio was the highest at 5.39, suggesting a comfortable margin of safety in meeting interest obligations. Subsequently, the ratio decreased but remained relatively stable around 4.0 in the following quarters of 2022 and the first two quarters of 2023.
While a declining trend in the interest coverage ratio may raise some concerns, it is important to note that the ratio has stayed above the threshold of 3, which generally indicates a healthy level of interest coverage. However, management should continue monitoring the trend to ensure the company's ability to meet interest payments remains robust.
Peer comparison
Dec 31, 2023