Standex International Corporation (SXI)
Interest coverage
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 92,741 | 95,123 | 164,650 | 89,127 | 60,979 |
| Interest expense | US$ in thousands | 23,931 | 4,544 | 5,405 | 5,874 | 5,992 |
| Interest coverage | 3.88 | 20.93 | 30.46 | 15.17 | 10.18 |
June 30, 2025 calculation
Interest coverage = EBIT ÷ Interest expense
= $92,741K ÷ $23,931K
= 3.88
The interest coverage ratios for Standex International Corporation over the specified periods demonstrate notable fluctuations that merit detailed analysis. As of June 30, 2021, the interest coverage stood at 10.18, indicating that the company generated sufficient earnings before interest and taxes (EBIT) to cover its interest expenses approximately ten times, which suggests a comfortable margin of safety.
By June 30, 2022, this ratio increased substantially to 15.17, reflecting improved earnings capacity relative to interest obligations. This upward movement indicates enhanced profitability or effective cost management, resulting in a stronger buffer to meet interest payments.
The most significant increase occurred by June 30, 2023, with a ratio of 30.46. Such a high interest coverage ratio suggests a highly favorable environment for debt servicing, implying that the company's earnings before interest and taxes more than triple the interest expenses compared to the previous year. This points to robust operational performance or possibly reduced interest costs.
However, the ratio declined in subsequent years, with June 30, 2024, recording a decrease to 20.93. Despite this reduction, the ratio remains well above the generally considered safe threshold of 3 to 5, indicating continued financial stability in meeting interest obligations comfortably.
By June 30, 2025, the ratio dropped sharply to 3.88. While still above the critical minimum, this narrowing margin signals a potential concern. It could reflect declining earnings, increased interest expenses, or a combination of both, suggesting that the company’s capacity to comfortably cover interest obligations is diminishing and warrants ongoing monitoring.
Overall, the trends in the interest coverage ratio for Standex International Corporation indicate an initially strong capacity to service debt, peaking in 2023. The subsequent decline moving into 2024 and 2025 signals a need to scrutinize factors impacting earnings, such as operational challenges or changes in interest costs, to assess whether current levels remain sustainable and to identify potential risks related to debt servicing.
Peer comparison
Jun 30, 2025