SJW Corporation (SJW)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 157,087 | 140,386 | 123,186 | 124,150 | 63,653 |
| Interest expense | US$ in thousands | 66,144 | 58,062 | 54,339 | 54,255 | 31,796 |
| Interest coverage | 2.37 | 2.42 | 2.27 | 2.29 | 2.00 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $157,087K ÷ $66,144K
= 2.37
The interest coverage ratio for SJW Group has shown a fluctuating trend over the past five years. In 2023, the interest coverage ratio stood at 2.26, indicating that SJW Group generated $2.26 in operating income for every $1 of interest expense incurred. This represents an improvement compared to the previous year, where the ratio was 2.15.
Looking back further, in 2021 the interest coverage ratio was 1.95, showing a weaker ability to cover interest payments. However, in 2022 and 2019, the company exhibited stronger interest coverage ratios of 2.17 and 2.90 respectively.
Overall, while the interest coverage ratio for SJW Group has fluctuated over the years, it remained above 1.5 in each year, indicating that the company has generally been able to comfortably meet its interest payment obligations. However, stakeholders may need to monitor this ratio closely to ensure that the company's ability to cover interest expenses remains adequate.
Peer comparison
Dec 31, 2023