STERIS plc (STE)

Interest coverage

		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	Dec 31, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	666,142	820,155	791,521	298,461	266,554	133,984	150,493	570,315	405,113	458,195	400,528	430,000	555,243	565,694	561,480	546,557	538,833	526,013
Interest expense (ttm)	US$ in thousands	144,351	138,881	128,493	117,676	107,989	99,129	93,541	90,454	89,592	77,943	63,871	49,500	37,180	36,633	37,547	39,326	40,279	41,703
Interest coverage		4.61	5.91	6.16	2.54	2.47	1.35	1.61	6.31	4.52	5.88	6.27	8.69	14.93	15.44	14.95	13.90	13.38	12.61

March 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $666,142K ÷ $144,351K
= 4.61

The interest coverage ratio measures a company's ability to pay its interest expenses on outstanding debt. STERIS plc's interest coverage ratio has fluctuated over the past few quarters, ranging from a low of 1.35 in December 2022 to a high of 15.44 in December 2019.

A higher interest coverage ratio indicates that STERIS plc is more capable of paying its interest expenses from its operating income. The company's interest coverage ratio improved significantly in the most recent quarter, March 2024, reaching 4.61 compared to previous quarters.

The trend in STERIS plc's interest coverage ratio shows some variability, which may be influenced by changes in the company's operating income, interest expenses, or a combination of both. It is important to monitor the interest coverage ratio over time to ensure the company's ability to meet its interest obligations and maintain financial stability.