Roivant Sciences Ltd (ROIV)
Interest coverage
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | ||
|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 4,405,930 | -975,872 | -837,852 |
| Interest expense | US$ in thousands | 34,778 | 27,968 | 7,041 |
| Interest coverage | 126.69 | -34.89 | -119.00 |
March 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $4,405,930K ÷ $34,778K
= 126.69
Interest coverage ratio indicates the company's ability to meet its interest payments on outstanding debt with its earnings. A higher ratio implies better coverage and lower financial risk.
Roivant Sciences Ltd's interest coverage ratio has improved significantly from a negative value in the previous year to a very healthy level of 126.69 in the most recent fiscal year ending March 31, 2024. This indicates that the company's operating income is sufficient to cover its interest expenses multiple times over, reflecting a strong ability to fulfill its debt obligations.
The sharp increase in the interest coverage ratio is likely attributed to an improvement in the company's operating income relative to its interest expenses. This enhanced financial performance enhances investor confidence in the company's ability to manage its debt obligations effectively.
Overall, the positive trend in Roivant Sciences Ltd's interest coverage ratio suggests an improvement in its financial health and a reduced risk of defaulting on its interest payments.
Peer comparison
Mar 31, 2024