Procter & Gamble Company (PG)
Interest coverage
| 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 | Dec 31, 2019 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 19,395,000 | 19,975,000 | 19,659,000 | 19,920,000 | 19,024,000 | 18,318,000 | 18,003,000 | 18,349,000 | 18,383,000 | 18,303,000 | 18,138,000 | 17,799,000 | 18,071,000 | 18,024,000 | 17,579,000 | 17,198,000 | 16,223,000 | 7,633,000 | 7,453,000 | 6,879,000 |
| Interest expense (ttm) | US$ in thousands | 926,000 | 946,000 | 935,000 | 858,000 | 756,000 | 631,000 | 518,000 | 453,000 | 439,000 | 441,000 | 438,000 | 475,000 | 502,000 | 542,000 | 536,000 | 493,000 | 465,000 | 419,000 | 450,000 | 488,000 |
| Interest coverage | 20.94 | 21.12 | 21.03 | 23.22 | 25.16 | 29.03 | 34.75 | 40.51 | 41.87 | 41.50 | 41.41 | 37.47 | 36.00 | 33.25 | 32.80 | 34.88 | 34.89 | 18.22 | 16.56 | 14.10 |
June 30, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $19,395,000K ÷ $926,000K
= 20.94
Procter & Gamble Company's interest coverage ratio has shown a consistently strong performance over the past few quarters. The interest coverage ratio measures the company's ability to meet its interest payments on outstanding debt obligations.
Looking at the data provided, we can see that the interest coverage ratio has been well above 1, indicating that Procter & Gamble has more than enough earnings to cover its interest expenses. A higher interest coverage ratio is generally favorable as it signifies a lower risk of default on debt obligations.
The trend of the interest coverage ratio has been upward over the period analyzed, indicating an improving financial position. The increasing trend suggests that the company's profitability and operational efficiency have been improving, allowing it to comfortably meet its interest obligations.
In particular, the interest coverage ratio has significantly increased from 14.10 in the fourth quarter of 2019 to 41.50 in the first quarter of 2022. This substantial improvement indicates a substantial enhancement in the company's ability to service its debt through its earnings.
Overall, Procter & Gamble's interest coverage ratio reflects a financially sound position with a strong ability to cover interest expenses, providing a positive indication to investors and creditors regarding the company's financial health and stability.
Peer comparison
Jun 30, 2024