RPC Inc (RES)

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	113,266	152,004	153,437	199,592	281,229	342,423	409,142	383,640	289,599	196,442	112,936	52,257	18,584	-22,581	-61,913	-100,373	-309,058	-315,963	-378,403	-330,532
Interest expense (ttm)	US$ in thousands	724	689	529	503	341	317	359	508	614	709	1,846	1,727	1,929	1,879	672	640	373	330	265	358
Interest coverage		156.44	220.62	290.05	396.80	824.72	1,080.20	1,139.67	755.20	471.66	277.07	61.18	30.26	9.63	-12.02	-92.13	-156.83	-828.57	-957.46	-1,427.94	-923.27

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $113,266K ÷ $724K
= 156.44

The interest coverage ratio for RPC Inc provides insight into the company's ability to meet its interest obligations with its operating income. A ratio below 1 indicates that the company is not generating enough operating income to cover its interest expenses.

Based on the data provided, RPC Inc had negative interest coverage ratios in the range of -923.27 to -92.13 from March 2020 to June 2021. This suggests that during this period, the company was not generating enough operating income to cover its interest expenses, which may raise concerns about its financial health and ability to meet its debt obligations.

However, from September 2021 onwards, RPC Inc's interest coverage improved significantly, with ratios increasing to positive values. This indicates that the company's operating income has been sufficient to cover its interest expenses since then. The trend of increasing interest coverage ratios suggests a positive turnaround in the company's financial performance and ability to manage its debt obligations.

Overall, it is crucial for investors and stakeholders to monitor RPC Inc's interest coverage ratio continually to assess its financial stability and debt repayment capacity.