MillerKnoll Inc (MLKN)
Interest coverage
| Nov 30, 2024 | Aug 31, 2024 | Mar 2, 2024 | Dec 2, 2023 | Sep 2, 2023 | Jun 3, 2023 | Mar 4, 2023 | Dec 3, 2022 | Sep 3, 2022 | May 28, 2022 | Feb 26, 2022 | Nov 27, 2021 | Aug 28, 2021 | May 29, 2021 | Feb 27, 2021 | Nov 28, 2020 | Aug 29, 2020 | May 30, 2020 | Feb 29, 2020 | Nov 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 185,500 | 164,000 | 162,000 | 137,000 | 112,800 | 120,600 | 162,700 | 170,900 | 137,100 | 21,800 | -23,100 | 6,800 | 73,100 | 236,700 | 26,600 | 19,900 | 43,400 | 9,800 | 271,000 | 269,100 |
| Interest expense (ttm) | US$ in thousands | 78,500 | 77,300 | 77,300 | 78,000 | 76,500 | 74,000 | 67,000 | 58,100 | 49,000 | 37,900 | 28,100 | 21,500 | 15,800 | 13,900 | 14,400 | 13,700 | 13,200 | 12,500 | 11,900 | 12,000 |
| Interest coverage | 2.36 | 2.12 | 2.10 | 1.76 | 1.47 | 1.63 | 2.43 | 2.94 | 2.80 | 0.58 | -0.82 | 0.32 | 4.63 | 17.03 | 1.85 | 1.45 | 3.29 | 0.78 | 22.77 | 22.42 |
November 30, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $185,500K ÷ $78,500K
= 2.36
The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. Looking at the data provided for MillerKnoll Inc, we can see fluctuations in the interest coverage ratio over the past few years.
In the most recent period ending November 30, 2024, the interest coverage ratio was 2.38, indicating that the company generated operating income 2.38 times higher than its interest expenses. This shows a slight improvement compared to the previous period in August 31, 2024, where the ratio was 2.12.
Looking further back, we observe that the interest coverage ratio fluctuated over time. The ratio was relatively stable around 2.0 in the earlier periods of the data provided, but there were some significant fluctuations in between. For instance, there was a notable decline in the ratio to 0.58 on May 28, 2022, and even turned negative on February 26, 2022, which could be a cause for concern.
Overall, the trend in MillerKnoll Inc's interest coverage ratio shows fluctuations, with some periods of stronger coverage and others with weaker coverage. It is important for the company to consistently maintain a healthy interest coverage ratio to ensure its ability to meet its interest obligations and remain financially stable.