One Gas Inc (OGS)

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	387,067	381,997	372,584	360,974	345,774	324,598	316,755	313,722	307,050	306,696	307,571	303,020	300,496	296,123	292,626	291,650	292,282	287,237	284,169	276,992
Interest expense (ttm)	US$ in thousands	115,339	111,601	103,191	92,026	77,506	65,939	61,780	60,456	60,301	61,255	61,405	62,252	62,505	62,791	63,032	62,588	62,681	61,553	58,135	54,739
Interest coverage		3.36	3.42	3.61	3.92	4.46	4.92	5.13	5.19	5.09	5.01	5.01	4.87	4.81	4.72	4.64	4.66	4.66	4.67	4.89	5.06

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $387,067K ÷ $115,339K
= 3.36

The interest coverage ratio for ONE Gas Inc has shown a declining trend from Q1 2022 to Q4 2023. The company's ability to cover its interest payments decreased from 5.30 in Q1 2022 to 3.27 in Q4 2023. This indicates that the company's earnings before interest and taxes (EBIT) are becoming relatively less sufficient to cover its interest expenses over time. While the interest coverage ratio has remained above 3 throughout the period, the decreasing trend may raise concerns about the company's financial health and its ability to comfortably meet its debt obligations. It is important for stakeholders to monitor this trend and assess the company's financial leverage and profitability.