ViaSat Inc (VSAT)
Interest coverage
| Mar 31, 2025 | Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | — | -793,548 | -135,346 | -108,519 | -45,513 |
| Interest expense | US$ in thousands | 421,944 | 400,398 | 26,809 | 28,887 | 32,247 |
| Interest coverage | 0.00 | -1.98 | -5.05 | -3.76 | -1.41 |
March 31, 2025 calculation
Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $421,944K
= 0.00
Based on the provided data for ViaSat Inc's interest coverage ratio, it is evident that the company has been facing challenges in meeting its interest payment obligations with its operating income.
As of March 31, 2021, the interest coverage ratio stood at -1.41, indicating that ViaSat's operating income was insufficient to cover its interest expenses, which could potentially raise concerns about the company's financial leverage and ability to service its debt.
The situation worsened in the following years as the interest coverage ratios for March 31, 2022, and March 31, 2023, dropped to -3.76 and -5.05, respectively. These ratios suggest a deteriorating ability of ViaSat to generate enough earnings to cover its interest charges, raising red flags about its financial health and sustainability.
However, there seems to be a slight improvement in the interest coverage ratio as of March 31, 2024, with a value of -1.98, yet it still indicates a weakness in the company's ability to meet its interest obligations comfortably.
Lastly, the interest coverage ratio for March 31, 2025, shows a value of 0.00, which is concerning as it implies that ViaSat's operating income exactly matches its interest expenses. While this marks a potential turnaround from the negative ratios in the previous years, it also signifies a precarious position where any adverse change in operating income could lead to difficulties in servicing debt obligations.
In conclusion, the trend of declining interest coverage ratios for ViaSat Inc raises caution about its financial stability and ability to manage its debt effectively. Investors and stakeholders may closely monitor the company's performance and debt repayment capacity moving forward.
Peer comparison
Mar 31, 2025