Perrigo Company PLC (PRGO)

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	273,100	375,278	400,278	339,578	302,678	84,500	57,700	83,200	451,300	711,800	740,800	1,261,900	848,000	742,900	835,500	529,800	603,600	628,900	604,300	314,500
Interest expense (ttm)	US$ in thousands	173,300	173,200	173,900	172,100	169,600	163,900	156,000	145,600	135,500	128,800	125,000	121,900	125,000	126,800	125,000	128,900	125,400	123,200	121,600	123,100
Interest coverage		1.58	2.17	2.30	1.97	1.78	0.52	0.37	0.57	3.33	5.53	5.93	10.35	6.78	5.86	6.68	4.11	4.81	5.10	4.97	2.55

June 30, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $273,100K ÷ $173,300K
= 1.58

Perrigo Company PLC's interest coverage ratio has shown some fluctuations over the past few quarters. The interest coverage ratio measures a company's ability to meet its interest obligations with its operating income.

In the most recent quarter, the interest coverage ratio was 1.58, which indicates that the company earned 1.58 times the amount needed to cover its interest expenses. This level suggests that Perrigo's operating income may be only just sufficient to cover its interest payments, potentially signaling a risk of financial distress.

Looking back over the previous quarters, the trend in the interest coverage ratio has been mixed, with some quarters showing stronger performance (e.g., 5.93, 10.35) and others exhibiting weaker coverage (e.g., 0.37, 0.52). This variability may indicate fluctuations in Perrigo's profitability and ability to generate earnings to cover its debt obligations.

Overall, the interest coverage ratio of Perrigo Company PLC has shown both strengths and weaknesses in recent periods, and investors and creditors may want to closely monitor this ratio to assess the company's financial health and ability to service its debt in the future.