Worthington Steel Inc (WS)
Interest coverage
| May 31, 2025 | May 31, 2024 | Aug 31, 2023 | May 31, 2023 | Aug 31, 2022 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | — | 222,200 | 158,331 | 135,700 | 203,768 |
| Interest expense | US$ in thousands | 7,100 | 6,000 | — | 3,000 | — |
| Interest coverage | 0.00 | 37.03 | — | 45.23 | — |
May 31, 2025 calculation
Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $7,100K
= 0.00
The interest coverage ratio for Worthington Steel Inc. exhibits notable fluctuations over the periods analyzed. As of August 31, 2022, the company did not report a measurable interest coverage ratio, indicating either a lack of data or potentially no interest expense recorded at that time. By May 31, 2023, the interest coverage ratio significantly increased to 45.23, suggesting a robust capacity to meet interest obligations through earnings before interest and taxes (EBIT). This high ratio implies the company was generating substantial operating income relative to its interest expenses, reflecting strong financial health during that period.
Moving forward to August 31, 2023, the interest coverage ratio again was not reported, which lacks specific information for that date. However, the ratio recovered markedly by May 31, 2024, reaching 37.03. While slightly lower than the previous peak in 2023, this figure still indicates a very comfortable margin of earnings over interest expenses, emphasizing continued relative financial strength.
Most recently, the interest coverage ratio for May 31, 2025, recorded at 0.00, indicates that the company either reported no earnings before interest and taxes or potentially did not have sufficient EBIT to cover interest obligations. Such a ratio typically signals a critical concern regarding the company's ability to meet interest commitments solely from operational income, and it may reflect financial distress or extraordinary circumstances affecting profitability.
In summary, the interest coverage ratio for Worthington Steel Inc. shows periods of strong coverage, with ratios well above typical minimum thresholds that signal healthy debt servicing capacity. Nonetheless, the drop to zero signifies a possible deterioration in earnings or financial challenges that warrant further investigation to assess the company's ongoing ability to service debt obligations without additional capital or restructuring.
Peer comparison
May 31, 2025