Northern Oil & Gas Inc (NOG)

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	1,136,408	821,130	1,383,603	1,415,488	856,668	878,680	300,887	-45,332	65,615	-254,011	-499,518	-1,309,222	-847,704	-806,483	-472,225	475,195	2,910	328,748	252,274	115,953
Interest expense (ttm)	US$ in thousands	135,664	122,959	106,054	92,496	80,330	72,422	66,873	63,487	59,020	56,478	56,529	55,462	58,503	65,538	72,411	76,232	79,229	78,893	77,821	82,446
Interest coverage		8.38	6.68	13.05	15.30	10.66	12.13	4.50	-0.71	1.11	-4.50	-8.84	-23.61	-14.49	-12.31	-6.52	6.23	0.04	4.17	3.24	1.41

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,136,408K ÷ $135,664K
= 8.38

The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio indicates that the company is more capable of meeting its interest obligations.

Northern Oil and Gas Inc.'s interest coverage ratio fluctuated over the past eight quarters. In Q4 2023, the interest coverage was 8.27, showing the company generated operating income over eight times higher than its interest expenses. This was a positive sign for the company's ability to meet its interest payments.

In Q3 2023, the interest coverage ratio decreased to 6.55, but remained above 1, indicating the company still generated sufficient operating income to cover its interest expenses.

Q2 2023 saw a significant improvement in the interest coverage ratio to 12.89, signaling a strong ability to service its interest payments. This trend continued into Q1 2023, with an interest coverage ratio of 15.17, demonstrating a robust financial position.

In contrast, Q1 2022 had a negative interest coverage ratio of -0.74, indicating the company's operating income was insufficient to cover its interest expenses during that period. This could raise concerns about the company's financial health and ability to meet its debt obligations.

Overall, Northern Oil and Gas Inc.'s interest coverage ratios have shown variability over the past eight quarters, with some quarters demonstrating strong financial health and others indicating potential challenges in meeting interest payments. Monitoring these fluctuations can provide insights into the company's financial stability and ability to manage its debt effectively.