Materion Corporation (MTRN)
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 | 138,585 | 150,136 | 143,203 | 140,161 | 123,266 | 99,585 | 91,752 | 80,724 | 80,943 | 72,261 | 50,282 | 36,704 | 11,086 | 20,307 | 27,383 | 41,002 | 67,062 | 65,656 | 75,986 | 68,700 |
| Interest expense (ttm) | US$ in thousands | 35,127 | 32,329 | 30,539 | 27,599 | 23,832 | 18,130 | 13,103 | 9,260 | 6,286 | 4,551 | 5,024 | 5,425 | 4,910 | 4,106 | 3,208 | 2,449 | 2,669 | 2,262 | 2,439 | 2,606 |
| Interest coverage | 3.95 | 4.64 | 4.69 | 5.08 | 5.17 | 5.49 | 7.00 | 8.72 | 12.88 | 15.88 | 10.01 | 6.77 | 2.26 | 4.95 | 8.54 | 16.74 | 25.13 | 29.03 | 31.15 | 26.36 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $138,585K ÷ $35,127K
= 3.95
The interest coverage ratio of Materion Corp has been fluctuating over the past eight quarters, ranging from a low of 4.47 in Q4 2023 to a high of 9.91 in Q1 2022. Overall, the trend indicates a general decline in the company's ability to cover its interest expenses from its earnings. This can pose a potential risk as lower interest coverage ratios suggest that the company may have less cushion to meet its interest obligations. It is important for Materion Corp to closely monitor and manage its interest coverage ratio to ensure it remains at a healthy level, providing confidence to investors and creditors regarding the company's financial stability.