Patterson-UTI Energy Inc (PTEN)
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 | -887,169 | -743,871 | 258,303 | 321,192 | 360,314 | 364,800 | 427,884 | 354,091 | 208,118 | -267,690 | -432,277 | -575,179 | -675,269 | -440,009 | -463,867 | -513,954 | -890,248 | -847,319 | -1,038,996 | -926,608 |
| Interest expense (ttm) | US$ in thousands | 71,963 | 72,919 | 70,554 | 62,379 | 52,870 | 42,247 | 37,597 | 38,517 | 40,256 | 42,780 | 42,488 | 42,534 | 41,978 | 38,670 | 39,275 | 39,555 | 40,770 | 61,679 | 71,130 | 73,444 |
| Interest coverage | -12.33 | -10.20 | 3.66 | 5.15 | 6.82 | 8.63 | 11.38 | 9.19 | 5.17 | -6.26 | -10.17 | -13.52 | -16.09 | -11.38 | -11.81 | -12.99 | -21.84 | -13.74 | -14.61 | -12.62 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-887,169K ÷ $71,963K
= -12.33
Patterson-UTI Energy Inc's interest coverage ratio has shown a volatile trend over the specified time period. The interest coverage ratio calculates the company's ability to meet its interest payments on outstanding debt obligations.
From March 31, 2020, to September 30, 2022, the interest coverage ratios were negative, indicating that the company was unable to cover its interest expenses with its operating income during these quarters. This signifies a high level of risk to creditors and investors during this period.
However, the situation improved significantly starting from December 31, 2022, when the interest coverage ratio turned positive at 5.17. This positive trend continued into the future quarters, with values ranging from 5.15 to 11.38, indicating that Patterson-UTI Energy Inc's operating income has been consistently sufficient to cover its interest expenses.
The increasing trend in the interest coverage ratio from 2022 to 2024 reflects a healthier financial position for the company in terms of its ability to service its debt. Investors and creditors may find the recent improvements in the interest coverage ratio as a positive signal of the company's financial health and ability to manage its debt obligations effectively.
Peer comparison
Dec 31, 2024