Pool Corporation (POOL)
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 | 617,204 | 635,898 | 653,988 | 709,516 | 746,567 | 774,518 | 843,952 | 935,831 | 1,025,783 | 1,045,279 | 1,018,678 | 938,376 | 831,684 | 779,112 | 690,069 | 557,340 | 470,841 | 422,420 | 378,727 | 345,393 |
| Interest expense (ttm) | US$ in thousands | 50,250 | 51,922 | 53,166 | 56,014 | 58,430 | 61,809 | 59,917 | 51,548 | 40,911 | 27,205 | 17,815 | 11,255 | 8,639 | 9,923 | 9,467 | 10,147 | 12,354 | 14,527 | 18,164 | 21,945 |
| Interest coverage | 12.28 | 12.25 | 12.30 | 12.67 | 12.78 | 12.53 | 14.09 | 18.15 | 25.07 | 38.42 | 57.18 | 83.37 | 96.27 | 78.52 | 72.89 | 54.93 | 38.11 | 29.08 | 20.85 | 15.74 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $617,204K ÷ $50,250K
= 12.28
The interest coverage ratio of Pool Corporation, a measure of the company's ability to cover its interest expenses with operating income, has shown a generally positive trend over the past few years. The ratio has consistently increased from 15.74 as of March 31, 2020, to a peak of 96.27 as of December 31, 2021. This indicates that the company's operating income has been increasingly sufficient to cover its interest obligations during this period.
However, starting from March 31, 2022, the interest coverage ratio began to decline, reaching 12.28 as of December 31, 2024. This decreasing trend suggests that Pool Corporation may be facing challenges in generating enough operating income to cover its interest expenses efficiently.
It is important for investors and stakeholders to monitor this ratio closely, as a sustained decline in interest coverage could raise concerns about the company's financial health and its ability to meet its debt obligations. Pool Corporation may need to focus on improving its profitability or managing its debt levels to avoid potential financial distress in the future.