Ralph Lauren Corp Class A (RL)

Interest coverage

Mar 31, 2025 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
Earnings before interest and tax (EBIT) (ttm) US$ in thousands 921,400 868,800 849,700 821,900 806,100 586,500 557,100 596,800 591,700 725,800 726,700 771,900 812,200 756,000 657,100 387,100 -3,400 -262,700 -208,800 57,300
Interest expense (ttm) US$ in thousands 47,300 45,500 44,500 43,100 42,200 37,700 39,100 38,600 40,400 47,000 48,400 52,500 54,000 54,200 53,000 52,200 48,500 39,400 31,400 23,000
Interest coverage 19.48 19.09 19.09 19.07 19.10 15.56 14.25 15.46 14.65 15.44 15.01 14.70 15.04 13.95 12.40 7.42 -0.07 -6.67 -6.65 2.49

March 31, 2025 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $921,400K ÷ $47,300K
= 19.48

Interest coverage ratio measures a company's ability to meet its interest obligations on outstanding debt. It is calculated by dividing earnings before interest and taxes (EBIT) by the company's interest expenses.

Analyzing the interest coverage data provided for Ralph Lauren Corp Class A, we observe fluctuations in the ratio over the specified time period. In June 2020, the interest coverage ratio was 2.49, indicating that the company's EBIT was sufficient to cover its interest expenses comfortably.

However, the following quarters showed a concerning trend with negative values, indicating that the company's EBIT was not enough to cover its interest obligations. This could suggest financial distress or challenges in generating profits to cover interest payments during that period.

Starting from June 2021, the interest coverage ratio improved significantly, surpassing 12 in the subsequent quarters. This significant improvement indicates that the company's earnings were more than enough to cover its interest expenses, reflecting a healthier financial position and improved profitability.

By the end of March 2025, the interest coverage ratio stood at 19.48, signifying a strong ability to meet interest payments. This improvement over time suggests that Ralph Lauren Corp Class A has successfully managed its interest obligations and enhanced its financial stability.

Overall, the analysis of the interest coverage ratio for Ralph Lauren Corp Class A indicates fluctuations in the company's ability to cover interest expenses but demonstrates a positive trend towards improved financial health and profitability in recent quarters.


Peer comparison

Mar 31, 2025