Steel Dynamics Inc (STLD)

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	1,993,736	2,253,730	2,601,648	3,137,605	3,256,926	3,520,695	3,981,501	4,508,501	5,112,605	5,751,490	5,832,940	5,156,556	4,266,284	3,123,253	1,960,293	1,145,344	837,491	741,717	821,997	980,531
Interest expense (ttm)	US$ in thousands	56,347	56,563	57,907	65,955	76,484	85,544	92,476	97,376	91,538	80,021	67,378	56,609	57,209	65,077	71,323	84,127	94,877	106,993	119,382	124,001
Interest coverage		35.38	39.84	44.93	47.57	42.58	41.16	43.05	46.30	55.85	71.87	86.57	91.09	74.57	47.99	27.48	13.61	8.83	6.93	6.89	7.91

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,993,736K ÷ $56,347K
= 35.38

The interest coverage ratio of Steel Dynamics Inc has shown a positive trend over the years, indicating the company's ability to meet its interest obligations from its operating income. The ratio increased from 7.91 as of March 31, 2020, to 35.38 as of December 31, 2024.

Steel Dynamics Inc experienced a significant improvement in its interest coverage ratio, particularly in the recent quarters, with notable spikes in March 31, 2023 (46.30), and March 31, 2024 (47.57). This suggests that the company's earnings are sufficiently covering its interest expenses, reflecting a strong financial position.

The consistent increase in the interest coverage ratio demonstrates the company's improved profitability and cash flow generation, which enhances its ability to service its debt obligations comfortably. Overall, the upward trend in the interest coverage ratio indicates a positive financial performance and a stable debt servicing capacity for Steel Dynamics Inc.