Northwest Natural Gas Co (NWN)

Interest coverage

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	191,142	202,796	168,680	126,723	106,937
Interest expense	US$ in thousands	80,092	76,566	53,247	44,486	43,052
Interest coverage		2.39	2.65	3.17	2.85	2.48

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $191,142K ÷ $80,092K
= 2.39

The interest coverage ratio for Northwest Natural Gas Co has shown a positive trend over the past five years. Starting at 2.48 in December 31, 2020, it increased steadily to 2.85 in December 31, 2021, further improving to 3.17 in December 31, 2022. However, there was a slight dip in December 31, 2023 to 2.65, followed by a decrease to 2.39 in December 31, 2024.

Overall, the company's interest coverage ratio indicates its ability to comfortably meet its interest obligations with its operating income. While the recent decrease in the ratio raises some concerns, it is important for the company to continue monitoring and managing its debt levels to ensure its financial stability and ability to cover interest expenses in the future.