Movado Group Inc (MOV)
Interest coverage
| Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 59,850 | 71,748 | 87,573 | 107,015 | 119,899 | 131,046 | 134,277 | 128,657 | 117,016 | 104,899 | 86,757 | 54,289 | -140,747 | -158,310 | -158,307 | -128,252 | 58,796 | 67,577 | 68,885 | 59,316 |
| Interest expense (ttm) | US$ in thousands | 497 | 523 | 531 | 519 | 518 | 462 | 452 | 525 | 688 | 1,072 | 1,547 | 1,963 | 1,959 | 1,710 | 1,342 | 977 | 930 | 930 | 836 | 773 |
| Interest coverage | 120.42 | 137.19 | 164.92 | 206.19 | 231.47 | 283.65 | 297.07 | 245.06 | 170.08 | 97.85 | 56.08 | 27.66 | -71.85 | -92.58 | -117.96 | -131.27 | 63.22 | 72.66 | 82.40 | 76.73 |
January 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $59,850K ÷ $497K
= 120.42
Movado Group Inc's interest coverage ratio has shown fluctuations over the past several quarters. The interest coverage ratio measures a company's ability to pay its interest expense with its earnings before interest and taxes (EBIT). A higher ratio indicates a better ability to cover interest expenses.
From January 31, 2020, to April 30, 2023, Movado Group Inc's interest coverage ratio generally increased steadily, reaching its peak in April 2023 at 206.19. This indicates a strong ability to cover interest expenses with operating profits during this period.
However, starting from January 31, 2023, there was a decline in the interest coverage ratio over the following quarters, indicating potential challenges in meeting interest obligations with operating earnings. The interest coverage ratio fell into negative territory in January 31, 2021, and October 31, 2021, suggesting that the operating profits were not sufficient to cover the interest expenses during these periods.
It is essential for Movado Group Inc to monitor and manage its interest coverage ratio effectively to ensure it maintains a healthy financial position and can meet its debt obligations comfortably.