RH (RH)
Interest coverage
| Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Feb 1, 2020 | Nov 2, 2019 | Aug 3, 2019 | May 4, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 394,136 | 411,167 | 534,268 | 591,060 | 550,494 | 635,729 | 721,103 | 759,503 | 887,051 | 863,465 | 723,019 | 616,403 | 445,709 | 363,392 | 334,505 | 302,720 | 356,359 | 313,440 | 273,288 | 249,226 |
| Interest expense (ttm) | US$ in thousands | 237,899 | 173,552 | 150,329 | 132,171 | 113,210 | 103,371 | 85,177 | 72,494 | 64,947 | 54,659 | 57,092 | 62,929 | 69,250 | 74,685 | 80,593 | 85,688 | 87,177 | 86,704 | 82,835 | 73,789 |
| Interest coverage | 1.66 | 2.37 | 3.55 | 4.47 | 4.86 | 6.15 | 8.47 | 10.48 | 13.66 | 15.80 | 12.66 | 9.80 | 6.44 | 4.87 | 4.15 | 3.53 | 4.09 | 3.62 | 3.30 | 3.38 |
February 3, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $394,136K ÷ $237,899K
= 1.66
The interest coverage ratio for RH has shown fluctuating trends over the past several quarters. The ratio indicates the company's ability to meet its interest payment obligations with its operating income.
Starting from Nov 2, 2019, the interest coverage ratio was 3.38, which increased to 4.09 by Feb 1, 2020, suggesting an improvement in the company's ability to cover its interest expenses. However, there was a slight decline in the ratio to 3.53 by May 2, 2020.
From May 2, 2020, onward, the interest coverage ratio experienced an increasing trend, reaching its peak at 15.80 by Oct 30, 2021. This significant improvement indicates strengthened financial health and operational efficiency.
Subsequently, there was a slight decrease in the ratio to 12.66 by Jan 29, 2022, but it remained at relatively high levels until Feb 3, 2024, with the latest reported ratio at 1.66.
Overall, RH's interest coverage ratio has displayed variability over time, with periods of both improvement and slight decline. It is important for investors and stakeholders to monitor this ratio closely to assess the company's ability to manage its debt obligations in relation to its operating performance.
Peer comparison
Feb 3, 2024