Rollins Inc (ROL)
Interest coverage
| 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 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 657,224 | 645,670 | 630,998 | 603,410 | 583,226 | 564,070 | 532,350 | 512,238 | 493,388 | 472,508 | 453,951 | 452,828 | 447,636 | 1,033,741 | 879,106 | 700,753 | 485,811 | 295,264 | 276,464 | 268,115 |
| Interest expense (ttm) | US$ in thousands | 27,677 | 30,908 | 29,305 | 26,315 | 19,055 | 11,141 | 6,440 | 2,535 | 2,638 | 2,798 | 2,174 | 1,800 | 1,838 | 1,925 | 2,569 | 3,523 | 5,082 | 6,957 | 108,767 | 108,702 |
| Interest coverage | 23.75 | 20.89 | 21.53 | 22.93 | 30.61 | 50.63 | 82.66 | 202.07 | 187.03 | 168.87 | 208.81 | 251.57 | 243.55 | 537.01 | 342.20 | 198.91 | 95.59 | 42.44 | 2.54 | 2.47 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $657,224K ÷ $27,677K
= 23.75
Rollins Inc's interest coverage ratio, which measures the company's ability to cover its interest expenses with its operating income, has shown significant fluctuations over the reporting periods.
The interest coverage ratio stood at 2.47 as of March 31, 2020, indicating that the company's operating income was 2.47 times the amount needed to cover its interest expenses. The ratio improved slightly to 2.54 by June 30, 2020.
A notable increase in the interest coverage ratio was observed by September 30, 2020, reaching 42.44, indicating a substantial improvement in the company's ability to cover its interest obligations. This trend continued with a sharp increase to 95.59 by December 31, 2020.
The interest coverage ratio continued to climb significantly in the subsequent quarters, reaching its peak at 537.01 on September 30, 2021, and then slightly decreasing in the following periods.
However, starting from March 31, 2023, Rollins Inc experienced a decline in its interest coverage ratio, which dropped to 30.61 by December 31, 2023. The trend continued to decrease, hitting 22.93 as of March 31, 2024.
The decreasing trend in the interest coverage ratio raises concerns about Rollins Inc's ability to comfortably meet its interest payments from its operating income. It is important for the company to closely monitor its financial performance and take necessary measures to ensure the sustainability of its interest coverage ratio.
Peer comparison
Dec 31, 2024