Mesa Laboratories Inc (MLAB)

Interest coverage

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	-269,951	4,596	3,872	8,890	4,381	4,470	69	829	7,519	13,440	10,986	9,946	10,327	4,241	4,763	5,139	7,858	9,390	13,965	11,514
Interest expense (ttm)	US$ in thousands	5,697	5,189	4,495	4,804	4,770	3,390	3,246	2,847	2,707	4,928	5,860	6,979	8,024	7,785	7,764	7,227	5,703	4,111	2,577	2,117
Interest coverage		-47.38	0.89	0.86	1.85	0.92	1.32	0.02	0.29	2.78	2.73	1.87	1.43	1.29	0.54	0.61	0.71	1.38	2.28	5.42	5.44

March 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-269,951K ÷ $5,697K
= -47.38

The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher ratio indicates a stronger ability to meet interest payments. Mesa Laboratories Inc's interest coverage ratio has fluctuated over the past few quarters, ranging from negative values to positive values.

The interest coverage ratio was notably low in the most recent quarter, indicating difficulties in covering interest payments with operating income. This could be a cause for concern as it may suggest financial strain. However, the ratio has shown improvements compared to the prior quarters, where it was either close to or below 1 which raises questions about the company's ability to meet its interest obligations.

It is important for Mesa Laboratories Inc to closely monitor and improve its interest coverage ratio to ensure financial stability and sound debt management. Further analysis of the company's financial health and strategies to improve profitability may be necessary to address the fluctuating interest coverage ratio observed in recent quarters.