Tetra Tech Inc (TTEK)
Interest coverage
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 500,737 | 358,113 | 340,446 | 278,701 | 241,091 |
| Interest expense | US$ in thousands | 37,271 | 52,435 | 13,364 | 12,748 | 14,475 |
| Interest coverage | 13.44 | 6.83 | 25.47 | 21.86 | 16.66 |
September 30, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $500,737K ÷ $37,271K
= 13.44
The interest coverage ratio measures a company's ability to meet its interest payments on debt obligations. Tetra Tech Inc's interest coverage ratio has shown fluctuating trends over the past five years, as follows:
- In 2024, the interest coverage ratio was 13.44, indicating that the company generated earnings 13.44 times greater than its interest expenses. This suggests a strong ability to cover interest payments with operating income.
- In 2023, the interest coverage ratio decreased to 6.83, potentially indicating a decrease in profitability or an increase in interest expenses compared to the previous year.
- In 2022, the interest coverage ratio surged to 25.47, portraying a significant improvement in the company's ability to cover interest expenses, possibly due to higher operating income or lower interest costs.
- In 2021, the interest coverage ratio was 21.86, representing a robust ability to meet interest obligations, although slightly lower than the previous year's ratio.
- In 2020, the interest coverage ratio stood at 16.66, indicating a healthy ability to cover interest payments.
Overall, while the interest coverage ratio has varied, Tetra Tech Inc generally demonstrates a solid ability to meet its interest obligations based on the ratios observed in the last five years.
Peer comparison
Sep 30, 2024