Mueller Water Products (MWA)
Interest coverage
| Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 207,500 | 198,900 | 184,600 | 179,600 | 146,900 | 115,500 | 122,900 | 110,600 | 113,400 | 116,600 | 117,200 | 133,000 | 142,000 | 141,200 | 141,200 | 91,200 | 73,100 | 75,600 | 69,000 | 146,700 |
| Interest expense (ttm) | US$ in thousands | 19,100 | 19,100 | 19,200 | 17,900 | 19,800 | 19,100 | 18,400 | 17,800 | 17,400 | 17,600 | 17,600 | 17,700 | 20,300 | 21,900 | 23,800 | 25,500 | 24,800 | 24,900 | 26,500 | 25,300 |
| Interest coverage | 10.86 | 10.41 | 9.61 | 10.03 | 7.42 | 6.05 | 6.68 | 6.21 | 6.52 | 6.62 | 6.66 | 7.51 | 7.00 | 6.45 | 5.93 | 3.58 | 2.95 | 3.04 | 2.60 | 5.80 |
March 31, 2025 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $207,500K ÷ $19,100K
= 10.86
The interest coverage ratio for Mueller Water Products demonstrates a generally stable and healthy financial position concerning its ability to meet interest obligations over the observed period. Initially, as of June 30, 2020, the ratio stood at 5.80, indicating that the company's operating earnings before interest and taxes (EBIT) were nearly six times its interest expenses. During the subsequent quarter, the ratio declined to 2.60, which reflects a significant decrease, suggesting reduced profitability or increased interest expenses during that period.
Throughout the remainder of 2020 and into 2021, the ratio exhibits fluctuations: it recovered somewhat to 3.04 by December 31, 2020, then further increased to 3.58 in June 2021, before rising sharply to 5.93 in September 2021 and reaching 6.45 by the end of 2021. These increases indicate improved coverage and lower relative interest burden in this period.
From early 2022 onwards, the ratio maintained a high level, with values above 6. indicating strong interest coverage; it peaked at 7.51 on June 30, 2022. Slight declines followed but remained robust, with the ratio staying above 6 during the second half of 2022 and into 2023, approximately oscillating around 6 to 7. This consistency implies that the company continued to generate sufficient operating earnings to comfortably cover interest expenses.
Projections for 2024 and into 2025 depict an optimistic trend, with the ratio forecasted to increase beyond 9 and eventually surpassing 10, reaching 10.41 by the end of 2024 and 10.86 in the first quarter of 2025. Such levels indicate an increasingly favorable position, with EBIT markedly exceeding interest obligations.
Overall, the data illustrates an initial period of volatility but demonstrates a strong and sustained improvement in interest coverage ratios over time. The company has maintained ratios well above the generally acceptable threshold of 3, signifying a robust capacity to meet interest payments comfortably, which suggests solid financial health and prudent management of debt obligations.
Peer comparison
Mar 31, 2025