NewJersey Resources Corporation (NJR)

Interest coverage

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Earnings before interest and tax (EBIT)	US$ in thousands	437,013	436,947	229,735	267,098	189,457
Interest expense	US$ in thousands	123,014	85,830	78,559	67,597	47,082
Interest coverage		3.55	5.09	2.92	3.95	4.02

September 30, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $437,013K ÷ $123,014K
= 3.55

The interest coverage ratio of New Jersey Resources Corporation has fluctuated over the past five years. In Sep 30, 2023, the interest coverage ratio was 3.34, down from 4.83 in Sep 30, 2022. This indicates a decrease in the company's ability to cover its interest expenses from its operating profits. However, in 2021, the ratio was 2.61, suggesting a weaker position in meeting interest obligations compared to the two previous years. In Sep 30, 2020, the ratio improved slightly to 3.41 but was still lower than the ratio in Sep 30, 2019, which was 3.56. Overall, the trend of fluctuating interest coverage ratios may indicate variability in the company's ability to service its debt obligations from its operating income.