REX American Resources Corporation (REX)

Interest coverage

		Jan 31, 2024	Oct 31, 2023	Jul 31, 2023	Apr 30, 2023	Jan 31, 2023	Oct 31, 2022	Jul 31, 2022	Apr 30, 2022	Jan 31, 2022	Oct 31, 2021	Jul 31, 2021	Apr 30, 2021	Jan 31, 2021	Oct 31, 2020	Jul 31, 2020	Apr 30, 2020	Jan 31, 2020	Oct 31, 2019	Jul 31, 2019	Apr 30, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	63,594	60,711	32,480	30,182	32,494	56,372	71,764	68,820	69,925	37,991	32,571	22,310	561	311	-19,002	-13,993	-1,144	-5,519	2,707	6,756
Interest expense (ttm)	US$ in thousands	7,849	9,998	11,981	20,162	12,634	10,498	8,515	334	13	0	0	0	0	0	0	0	0	0	0	0
Interest coverage		8.10	6.07	2.71	1.50	2.57	5.37	8.43	206.05	5,378.85	—	—	—	—	—	—	—	—	—	—	—

January 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $63,594K ÷ $7,849K
= 8.10

The interest coverage ratio of REX American Resources Corporation has displayed significant fluctuations over the reported periods. In January 2024, the interest coverage ratio stood at 8.10, indicating that the company is able to cover its interest expenses 8.10 times over with its operating income. This signifies a healthy ability to meet interest obligations. Comparatively, in October 2023, the interest coverage ratio decreased to 6.07, suggesting a slight decline in the company's ability to cover interest expenses.

In July 2022, the interest coverage ratio spiked to 8.43, reflecting an exceptional ability to cover interest payments. However, this ratio significantly escalated to 206.05 in April 2022 and dramatically rose to 5,378.85 in January 2022. Such unusually high ratios could be attributed to anomalies or one-time events impacting the financial results significantly.

It is notable that in some periods, like July 2023 and April 2023, the interest coverage ratio fell to 2.71 and 1.50, respectively, indicating a potential strain on the company's ability to cover its interest expenses with its operating income. These lower ratios may raise concerns regarding the company's financial health and ability to meet debt obligations.

Overall, while the interest coverage ratio has exhibited variability, investors should closely monitor the fluctuations and assess the company's ability to generate sufficient operating income to cover interest expenses in the long term.