Martin Marietta Materials Inc (MLM)
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 | 1,626,700 | 1,520,500 | 1,370,400 | 1,402,000 | 1,270,600 | 1,210,100 | 1,155,300 | 957,500 | 998,400 | 1,023,900 | 1,066,000 | 1,060,000 | 1,007,200 | 957,400 | 900,000 | 862,500 | 877,500 | 840,206 | 737,784 | 736,033 |
| Interest expense (ttm) | US$ in thousands | 165,400 | 167,800 | 169,800 | 170,700 | 169,000 | 169,200 | 170,700 | 155,700 | 142,600 | 128,200 | 112,600 | 115,700 | 118,100 | 120,300 | 124,000 | 126,100 | 129,200 | 132,174 | 135,242 | 134,913 |
| Interest coverage | 9.83 | 9.06 | 8.07 | 8.21 | 7.52 | 7.15 | 6.77 | 6.15 | 7.00 | 7.99 | 9.47 | 9.16 | 8.53 | 7.96 | 7.26 | 6.84 | 6.79 | 6.36 | 5.46 | 5.46 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,626,700K ÷ $165,400K
= 9.83
The interest coverage ratio for Martin Marietta Materials, Inc. over the past eight quarters has shown a generally increasing trend, indicating the company's improving ability to meet its interest obligations with its earnings before interest and taxes (EBIT). The ratio has consistently been above 6 for all quarters, suggesting that the company's operating profits are more than sufficient to cover its interest expenses.
In the most recent quarter, Q4 2023, the interest coverage ratio reached 9.73, which is the highest level in the table. This indicates that Martin Marietta Materials, Inc. earned nearly 10 times its interest expenses in that quarter, reflecting a strong financial position and solid cash flow generation.
Overall, the upward trend in the interest coverage ratio signifies the company's improving financial health and ability to manage its debt obligations effectively. Investors and creditors may view this positively as it reflects the company's capacity to honor its debt commitments and indicates a reduced risk of default.
Peer comparison
Dec 31, 2023