NiSource Inc (NI)

Interest coverage

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Earnings before interest and tax (EBIT)	US$ in thousands	1,343,400	1,330,300	1,043,800	336,000	885,500
Interest expense	US$ in thousands	489,600	361,600	341,100	370,700	378,900
Interest coverage		2.74	3.68	3.06	0.91	2.34

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $1,343,400K ÷ $489,600K
= 2.74

Interest coverage ratio indicates the ability of NiSource Inc to meet its interest payments on debt obligations with its operating income. A higher interest coverage ratio implies a stronger ability to cover interest expenses.

Analyzing the trend in NiSource Inc's interest coverage ratio over the past five years shows that there has been some fluctuation. In 2023, the interest coverage ratio decreased to 2.58 from 3.25 in 2022, indicating a reduced ability to cover interest expenses compared to the previous year. However, it is still above the industry benchmark of 2, suggesting that NiSource Inc can meet its interest obligations comfortably.

In 2021 and 2022, the interest coverage ratio remained relatively stable at 3.01 and 3.25, respectively, indicating consistent performance in meeting interest payments. On the other hand, in 2020 and 2019, the interest coverage ratio was lower at 2.63 and 3.52, respectively. This suggests that in 2020, NiSource Inc had a slightly weaker ability to cover its interest expenses, while in 2019, it had a stronger ability.

Overall, despite some fluctuations, the trend in NiSource Inc's interest coverage ratio indicates a generally stable financial health with the ability to meet its interest obligations efficiently.