Prestige Brand Holdings Inc (PBH)

Interest coverage

		Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021	Mar 31, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	281,225	-22,415	329,919	297,402	291,155
Interest expense	US$ in thousands	5,200	4,400	64,526	82,582	96,650
Interest coverage		54.08	-5.09	5.11	3.60	3.01

March 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $281,225K ÷ $5,200K
= 54.08

Prestige Brand Holdings Inc's interest coverage ratio has shown significant fluctuation over the past five years. The interest coverage ratio indicates the company's ability to meet interest obligations on its debt. In 2024, the interest coverage ratio stood at a healthy 54.08, indicating that the company's operating income was more than sufficient to cover its interest expenses. This is a positive sign, as it suggests that Prestige Brand Holdings Inc has a strong ability to meet its debt obligations.

However, in 2023, the interest coverage ratio was negative at -5.09, which is a concerning sign. This suggests that the company's operating income was insufficient to cover its interest expenses during that year. It may indicate financial distress and the need for the company to reevaluate its debt levels or operations to improve profitability.

In 2022, 2021, and 2020, the interest coverage ratios were 5.11, 3.60, and 3.01, respectively. These ratios indicate that the company's operating income was able to cover its interest expenses, although with varying degrees of comfort.

Overall, the trend in Prestige Brand Holdings Inc's interest coverage ratio shows variability in the company's ability to meet its interest payments. It is important for investors and creditors to closely monitor this ratio to assess the company's financial health and its ability to manage debt effectively.