Somnigroup International Inc. (SGI)
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 | 639,100 | 625,600 | 607,500 | 591,800 | 602,600 | 628,900 | 646,200 | 630,600 | 677,700 | 783,600 | 832,600 | 895,500 | 889,100 | 828,500 | 760,700 | 608,200 | 528,400 | 420,400 | 358,800 | 385,700 |
| Interest expense (ttm) | US$ in thousands | 134,800 | 129,400 | 131,200 | 131,400 | 129,900 | 130,600 | 124,800 | 114,900 | 103,000 | 91,900 | 78,600 | 74,900 | 66,300 | 61,800 | 68,400 | 69,000 | 77,000 | 81,000 | 81,700 | 83,600 |
| Interest coverage | 4.74 | 4.83 | 4.63 | 4.50 | 4.64 | 4.82 | 5.18 | 5.49 | 6.58 | 8.53 | 10.59 | 11.96 | 13.41 | 13.41 | 11.12 | 8.81 | 6.86 | 5.19 | 4.39 | 4.61 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $639,100K ÷ $134,800K
= 4.74
Somnigroup International Inc.'s interest coverage ratio has shown a generally positive trend over the past few years. The interest coverage ratio has consistently improved from 4.61 in March 2020 to 4.74 in December 2024. This indicates the company's ability to cover its interest expenses has strengthened over time.
The interest coverage ratio measures the company's ability to pay interest expenses on its outstanding debt. A higher ratio suggests that the company is more capable of meeting its interest obligations from its operating income.
Despite some fluctuations in the ratio over the periods, the overall trend is positive, with the ratio consistently above 1 (indicating the company can cover its interest expenses). The ratio peaked at 13.41 in September and December 2021, showing a strong ability to cover interest payments during those periods.
However, it's worth noting that the ratio has slightly declined in recent periods, from 11.96 in March 2022 to 4.74 in December 2024. This decrease may require further investigation to understand the reasons behind the decline and whether it poses any risks to the company's financial health.
In conclusion, Somnigroup International Inc.'s interest coverage ratio has shown improvement over the years, indicating its strengthening ability to meet its interest obligations. However, the recent slight decline in the ratio may warrant monitoring to ensure financial stability and sustainability.
Peer comparison
Dec 31, 2024