ResMed Inc (RMD)

Interest coverage

		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	Dec 31, 2019	Sep 30, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	1,319,891	1,213,944	1,140,031	1,145,131	1,131,873	1,112,001	1,043,111	1,006,151	994,560	984,022	976,069	949,219	907,650	884,082	861,877	834,465	773,465	660,487	609,206	573,994
Interest expense (ttm)	US$ in thousands	45,708	54,731	58,669	55,202	47,379	37,978	28,476	24,086	22,312	22,418	22,779	22,623	23,988	27,537	31,682	36,110	40,377	43,728	46,173	43,440
Interest coverage		28.88	22.18	19.43	20.74	23.89	29.28	36.63	41.77	44.58	43.89	42.85	41.96	37.84	32.11	27.20	23.11	19.16	15.10	13.19	13.21

June 30, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,319,891K ÷ $45,708K
= 28.88

ResMed Inc's interest coverage ratio has shown a generally positive trend over the past few quarters, indicating the company's ability to cover its interest expenses with its earnings. The interest coverage ratio has consistently been above 15, which is considered a healthy level, demonstrating the company's robust financial health and ability to meet its interest obligations comfortably.

The interest coverage ratio peaked at 44.58 in the third quarter of 2022, indicating a strong ability to cover interest payments with operating income. While the ratio has slightly fluctuated over the quarters, it has remained well above the acceptable threshold of 1, showing that ResMed Inc has a comfortable cushion to handle its interest expenses.

Overall, the trend in ResMed Inc's interest coverage ratio suggests that the company has a solid financial position and is efficiently managing its debt obligations, which is a positive signal for investors and creditors.