Sally Beauty Holdings Inc (SBH)
Interest coverage
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 282,733 | 325,029 | 337,640 | 418,443 | 330,115 |
| Interest expense | US$ in thousands | 76,408 | 72,979 | 93,543 | 93,509 | 98,793 |
| Interest coverage | 3.70 | 4.45 | 3.61 | 4.47 | 3.34 |
September 30, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $282,733K ÷ $76,408K
= 3.70
Interest coverage measures a company's ability to meet its interest obligations using its operating income. A higher interest coverage ratio indicates a stronger ability to cover interest expenses.
Looking at Sally Beauty Holdings Inc's interest coverage ratios over the past five years, the company has shown consistency in its ability to cover interest expenses. In 2024, the interest coverage ratio stands at 3.70, which indicates that the company's operating income is 3.70 times larger than its interest expenses for that year.
Compared to the previous years, the interest coverage ratio fluctuated between 3.34 and 4.47. In 2023 and 2021, the company had relatively higher interest coverage ratios of 4.45 and 4.47, respectively, indicating a stronger ability to cover interest expenses during those periods.
Overall, Sally Beauty Holdings Inc's interest coverage ratios demonstrate a reasonable ability to meet its interest obligations over the years, with some fluctuations in performance. Further analysis of the company's financial health and industry comparisons would provide a more comprehensive assessment of its financial strength.
Peer comparison
Sep 30, 2024