Gibraltar Industries Inc (ROCK)
Interest coverage
| 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 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 150,729 | 147,009 | 141,215 | 138,277 | 130,102 | 123,516 | 114,098 | 105,368 | 96,988 | 104,924 | 107,889 | 107,228 | 107,190 | 104,701 | 95,094 | 90,965 | 88,165 | 81,245 | 78,791 | 84,433 |
| Interest expense (ttm) | US$ in thousands | 3,002 | 5,074 | 5,705 | 5,053 | 4,047 | 2,648 | 2,091 | 1,680 | 1,639 | 1,498 | 1,225 | 1,194 | 797 | 571 | 370 | 375 | 2,389 | 5,056 | 7,945 | 10,856 |
| Interest coverage | 50.21 | 28.97 | 24.75 | 27.37 | 32.15 | 46.65 | 54.57 | 62.72 | 59.18 | 70.04 | 88.07 | 89.81 | 134.49 | 183.36 | 257.01 | 242.57 | 36.90 | 16.07 | 9.92 | 7.78 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $150,729K ÷ $3,002K
= 50.21
Interest coverage is a key financial ratio used to assess a company's ability to meet its interest payments on outstanding debt. It is calculated by dividing the earnings before interest and taxes (EBIT) by the interest expense. In the case of Gibraltar Industries Inc., the interest coverage ratio has fluctuated over the past eight quarters.
In Q1 2022, the interest coverage ratio was highest at 67.66, indicating that the company generated 67.66 times more earnings than it needed to cover its interest expenses. This level of coverage suggests a strong ability to meet interest obligations using operating earnings.
Subsequently, the interest coverage ratio declined to 58.54 in Q2 2022 and further to 49.78 in Q3 2022, although it remained at healthy levels compared to industry benchmarks. However, there was a significant improvement in Q4 2022, as the ratio rose to 32.15, indicating an improvement in the company's ability to cover its interest expenses.
In the first quarter of 2023, the interest coverage ratio decreased to 27.37, which is a notable decline compared to the previous quarter. This may raise some concerns about the company's ability to service its debt obligations comfortably.
However, in Q2 2023 and Q3 2023, there was a slight recovery in the interest coverage ratio to 24.75 and 28.97, respectively. The most recent data for Q4 2023 shows a significant improvement in the interest coverage ratio to 51.47, indicating a strong ability to cover interest payments.
Overall, while there have been fluctuations in Gibraltar Industries Inc.'s interest coverage ratio over the past eight quarters, the company generally demonstrates a solid ability to meet its interest obligations. It is important for investors and stakeholders to monitor these trends to ensure financial stability and debt servicing capacity.
Peer comparison
Dec 31, 2023