ResMed Inc (RMD)

Interest coverage

		Jun 30, 2025	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
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	1,687,855	1,597,084	1,553,975	1,470,187	1,370,185	1,289,140	1,215,227	1,164,511	1,144,441	1,113,601	1,047,195	1,007,300	1,000,286	986,526	975,687	957,365	912,348	892,002	886,076	844,659
Interest expense (ttm)	US$ in thousands	16,840	20,633	34,217	43,234	52,689	58,082	58,669	55,202	47,379	37,978	28,476	24,086	22,312	22,115	22,531	22,507	23,989	27,841	31,931	36,227
Interest coverage		100.23	77.40	45.42	34.01	26.01	22.20	20.71	21.10	24.16	29.32	36.77	41.82	44.83	44.61	43.30	42.54	38.03	32.04	27.75	23.32

June 30, 2025 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,687,855K ÷ $16,840K
= 100.23

ResMed Inc.'s interest coverage ratios over the reported periods reveal a generally strong capacity to meet its interest obligations. As of September 30, 2020, the ratio stood at 23.32, indicating that the company's earnings before interest and taxes (EBIT) were more than twenty times its interest expenses, reflecting a very comfortable cushion. This high level of coverage maintained or increased through subsequent periods, reaching a peak of 45.42 on December 31, 2024, signifying an even more robust ability to service interest costs.

The ratios exhibit a trend of consistent strength, with the interest coverage exceeding 20 times from early 2020 through mid-2024. Notably, the ratio peaked at 77.40 in March 2025 and further increased to 100.23 in June 2025, underscoring an exceptional level of safety in meeting interest obligations. This upward trajectory suggests that the company’s EBIT has been growing substantially relative to its interest expenses, which may be attributable to improved operational efficiency, higher earnings, or reductions in interest costs.

Overall, the interest coverage metrics reflect a financially stable position with substantial margins of safety for interest payments. There are no signs of rising financial stress within the observed periods, as the ratios remain well above typical concern thresholds. The increasing trend indicates a strengthening of ResMed Inc.’s ability to comfortably service its debt, positioning it favorably in terms of financial health and creditworthiness.