Advanced Drainage Systems Inc (WMS)
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 | — | 755,615 | 727,282 | 417,061 | 347,929 |
| Interest expense | US$ in thousands | 91,803 | 88,862 | 70,182 | 33,550 | 35,658 |
| Interest coverage | 0.00 | 8.50 | 10.36 | 12.43 | 9.76 |
March 31, 2025 calculation
Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $91,803K
= 0.00
The interest coverage ratio for Advanced Drainage Systems Inc has shown fluctuations over the past few years. In March 2021, the interest coverage ratio was 9.76, indicating that the company's operating income was able to cover its interest expenses nearly 10 times. This ratio improved significantly to 12.43 by March 2022, suggesting a stronger ability to meet interest obligations.
However, in the following year, the interest coverage ratio decreased to 10.36, although it still remained at a healthy level. By March 2024, the ratio dropped further to 8.50, indicating a slight decrease in the company's ability to cover interest costs. Notably, in March 2025, the interest coverage ratio is reported as 0.00, which raises concerns as it suggests that the company's operating income was insufficient to cover its interest expenses during that period.
Overall, Advanced Drainage Systems Inc's interest coverage ratio has exhibited variability, with some years showing strong coverage and others indicating potential challenges in meeting interest obligations. It is important for the company to closely monitor its interest coverage ratio to ensure it maintains a healthy financial position and can fulfill its debt obligations.