Ralph Lauren Corp Class A (RL)

Interest coverage

		Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021	Mar 31, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	819,600	732,300	808,600	-26,300	344,000
Interest expense	US$ in thousands	42,200	40,400	54,000	48,500	17,600
Interest coverage		19.42	18.13	14.97	-0.54	19.55

March 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $819,600K ÷ $42,200K
= 19.42

The interest coverage ratio for Ralph Lauren Corp Class A has been consistently healthy over the past five years, indicating the company's ability to comfortably meet its interest obligations. The ratio has shown an upward trend from 14.97 in 2022 to 19.42 in 2024, which implies a strengthening financial position.

In particular, the significant improvement in interest coverage from a negative value in 2021 to 19.55 in 2020 demonstrates the company's effective management of its interest expenses. This positive trend indicates that Ralph Lauren Corp Class A has been generating ample operating income to cover its interest payments, reflecting a reduced financial risk and enhanced creditworthiness.

Overall, the consistent and positive trajectory of the interest coverage ratio for Ralph Lauren Corp Class A suggests a stable and robust financial performance, enabling the company to efficiently meet its debt obligations and potentially pursue future growth opportunities.