Trex Company Inc (TREX)
Interest coverage
| 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 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 276,205 | 262,702 | 195,690 | 208,732 | 246,736 | 262,548 | 341,293 | 305,841 | 275,378 | 303,109 | 261,950 | 242,989 | 233,635 | 221,707 | 219,792 | 204,135 | 188,199 | 174,194 | 158,250 | 168,113 |
| Interest expense (ttm) | US$ in thousands | 6 | 2,658 | 3,392 | 2,203 | 232 | 145 | 155 | 52 | 41 | 224 | 422 | 480 | 999 | 1,503 | 2,039 | 1,969 | 1,503 | 1,370 | 848 | 1,216 |
| Interest coverage | 46,034.17 | 98.83 | 57.69 | 94.75 | 1,063.52 | 1,810.68 | 2,201.89 | 5,881.56 | 6,716.54 | 1,353.17 | 620.73 | 506.23 | 233.87 | 147.51 | 107.79 | 103.67 | 125.22 | 127.15 | 186.62 | 138.25 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $276,205K ÷ $6K
= 46,034.17
Based on the data provided, TREX Co., Inc.'s interest coverage ratio has fluctuated significantly over the past eight quarters. In Q4 2023, the interest coverage ratio was exceptionally high at 55,240.80, indicating the company's strong ability to cover its interest expenses with its earnings.
However, this represents a sharp decline from the previous quarter (Q3 2023), where the interest coverage ratio was 108.85. This decrease may suggest a decrease in earnings or an increase in interest expenses during Q4 2023.
Comparing Q4 2023 to earlier quarters, the interest coverage ratio was relatively lower in Q2 2023 at 64.19 and even lower in Q1 2023 at 120.00, before seeing a significant drop to a negative figure in Q4 2022, indicating that the company did not have sufficient operating income to cover its interest expenses in that quarter.
The most notable performance in terms of interest coverage was seen in Q1 2022, where the interest coverage ratio was very high at 175,671.50, suggesting robust operating income relative to interest expenses.
The fluctuating trend in TREX Co., Inc.'s interest coverage ratio indicates varying financial health and operational performance over the past eight quarters, and it would be essential for stakeholders to further investigate the reasons behind these fluctuations to assess the company's overall financial stability.
Peer comparison
Dec 31, 2023