Olin Corporation (OLN)
Interest coverage
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 339,600 | 381,900 | 542,500 | 607,700 | 792,300 | 972,800 | 1,192,900 | 1,553,800 | 1,813,300 | 2,072,200 | 2,217,900 | 1,913,200 | 1,751,900 | 1,291,400 | 84,900 | -274,800 | -711,200 | -820,500 | -55,900 | 65,000 |
| Interest expense (ttm) | US$ in thousands | 184,500 | 186,800 | 184,600 | 183,300 | 181,100 | 174,400 | 164,200 | 153,400 | 143,900 | 247,000 | 265,000 | 296,400 | 348,000 | 290,000 | 310,600 | 314,100 | 292,700 | 271,100 | 260,400 | 248,900 |
| Interest coverage | 1.84 | 2.04 | 2.94 | 3.32 | 4.37 | 5.58 | 7.26 | 10.13 | 12.60 | 8.39 | 8.37 | 6.45 | 5.03 | 4.45 | 0.27 | -0.87 | -2.43 | -3.03 | -0.21 | 0.26 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $339,600K ÷ $184,500K
= 1.84
The interest coverage ratio is a measure of a company's ability to cover its interest expenses with its earnings. It is calculated by dividing earnings before interest and taxes (EBIT) by interest expenses. A higher interest coverage ratio indicates a company is more capable of meeting its interest obligations.
Analyzing Olin Corporation's interest coverage over time, we can see fluctuations in the ratio. In the first half of 2020, the interest coverage ratio was negative, indicating that the company's earnings were insufficient to cover its interest expenses during that period. However, from September 2021 onwards, the trend shows a consistent improvement in the interest coverage ratio, reaching double-digit values by the end of 2022. This upward trend suggests that Olin Corporation's ability to cover its interest expenses has strengthened significantly.
A rising interest coverage ratio is generally viewed positively by investors and creditors as it indicates the company is becoming more financially stable and less risky in terms of debt repayment. However, it's important to monitor the ratio over time to ensure that the trend remains positive and sustainable.
Peer comparison
Dec 31, 2024