PriceSmart Inc (PSMT)

Interest coverage

		Aug 31, 2024	May 31, 2024	Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020	Feb 29, 2020	Nov 30, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	217,952	202,143	196,572	187,112	180,176	185,001	172,493	170,168	166,003	159,301	161,678	158,669	154,142	153,124	141,930	136,893	123,498	125,500	124,976	121,498
Interest expense (ttm)	US$ in thousands	12,959	12,398	11,566	11,087	11,020	11,097	11,146	10,770	9,611	8,177	6,977	6,767	7,210	8,366	9,334	8,796	7,625	6,106	4,457	3,768
Interest coverage		16.82	16.30	17.00	16.88	16.35	16.67	15.48	15.80	17.27	19.48	23.17	23.45	21.38	18.30	15.21	15.56	16.20	20.55	28.04	32.24

August 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $217,952K ÷ $12,959K
= 16.82

PriceSmart Inc has demonstrated consistently strong interest coverage over the past several periods, with ratios ranging from 15.21 to 32.24. This indicates the company's ability to comfortably meet its interest obligations using its earnings before interest and taxes. The upward trend in the interest coverage ratio suggests improving financial health and increasing profitability. The high and stable interest coverage ratios signify that PriceSmart Inc has a healthy level of profitability to cover its interest expenses, reducing its financial risk. Overall, the company's interest coverage ratios reflect a solid financial position and ability to manage its debt obligations effectively.