Madison Square Garden Sports Corp (MSGS)
Interest coverage
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 4,380 | 133,257 | 112,805 | 85,667 | -78,757 |
| Interest expense | US$ in thousands | 21,652 | 27,589 | 22,884 | 11,735 | 10,561 |
| Interest coverage | 0.20 | 4.83 | 4.93 | 7.30 | -7.46 |
June 30, 2025 calculation
Interest coverage = EBIT ÷ Interest expense
= $4,380K ÷ $21,652K
= 0.20
The interest coverage ratio of Madison Square Garden Sports Corp, as reflected in the provided data, demonstrates variability over the specified periods. On June 30, 2021, the company exhibited a significantly negative interest coverage ratio of -7.46, indicating that its operating income was insufficient to cover interest expenses, and suggesting substantial financial stress at that time.
By June 30, 2022, the ratio shifted to a positive value of 7.30, signifying a marked improvement in the company's ability to service its interest obligations through operating income. This improvement indicates that the company experienced enhanced profitability or reduced interest expenses during this period.
The subsequent year, June 30, 2023, shows a decline to 4.93, still reflective of a comfortable coverage but representing a decrease from the previous year's level. This suggests a potential reduction in operating income or an increase in interest expenses, or a combination of both, which moderated the company's ability to cover interest obligations.
As of June 30, 2024, the ratio remains relatively stable at 4.83, indicating continued coverage, albeit with a slight decrease compared to the prior year. This stability suggests consistent financial performance with respect to interest obligations.
However, projected data as of June 30, 2025, presents a sharp decline to 0.20, implying that the company's operating income is now barely sufficient to cover interest expenses, or potentially insufficient if the ratio were to decline further. This steep reduction raises concerns about the company's financial health and its ability to meet interest obligations without additional sources of income or refinancing.
Overall, the interest coverage trend exhibits a significant turnaround from a distressed position in 2021 to relatively comfortable coverage levels in 2022 through 2024, with a notable deterioration projected for 2025. This pattern underscores the importance of monitoring the company's operating income trajectory and its impact on debt servicing capacity over time.
Peer comparison
Jun 30, 2025