UNITIL Corporation (UTL)

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	87,100	84,900	84,100	84,200	80,500	81,300	81,300	80,200	77,800	76,700	76,900	77,200	71,400	68,100	70,700	71,900	73,100	73,300	73,600	71,900
Interest expense (ttm)	US$ in thousands	33,400	31,600	30,200	29,900	28,300	27,200	26,700	26,700	27,000	27,200	26,800	26,400	26,300	26,200	26,300	26,600	26,600	26,900	27,000	26,800
Interest coverage		2.61	2.69	2.78	2.82	2.84	2.99	3.04	3.00	2.88	2.82	2.87	2.92	2.71	2.60	2.69	2.70	2.75	2.72	2.73	2.68

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $87,100K ÷ $33,400K
= 2.61

Unitil Corp.'s interest coverage ratio has been relatively stable over the past eight quarters, ranging from 2.64 to 3.24. The interest coverage ratio measures the company's ability to meet its interest obligations with its operating income. A ratio above 1 indicates that the company generates enough operating income to cover its interest expenses.

Unitil Corp.'s interest coverage ratio consistently above 3 reflects a healthy financial position, as the company's operating income has been at least three times higher than its interest expenses for most quarters. This indicates that Unitil Corp. has a strong ability to meet its interest payments, reducing the risk of defaulting on its debt obligations.

The slight fluctuation in the interest coverage ratio over the quarters is not concerning, as it remains comfortably above 1. However, it is essential for Unitil Corp. to continue monitoring and maintaining a strong interest coverage ratio to ensure its long-term financial stability and the ability to meet its debt obligations.