Invensys (FRA:SBPD) Interest Coverage : 26.67 (As of Sep. 2013)

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What is Invensys Interest Coverage?

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. Invensys's Operating Income for the six months ended in Sep. 2013 was €95 Mil. Invensys's Interest Expense for the six months ended in Sep. 2013 was €-4 Mil. Invensys's interest coverage for the quarter that ended in Sep. 2013 was 26.67. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Invensys's Interest Coverage or its related term are showing as below:

FRA:SBPD's Interest Coverage is not ranked ^*
in the Industrial Products industry.
Industry Median: 13.775
* Ranked among companies with meaningful Interest Coverage only.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Invensys Interest Coverage Historical Data

The historical data trend for Invensys's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

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Invensys Interest Coverage Chart

Invensys Annual Data

Trend

Mar04

Mar05

Mar06

Mar07

Mar08

Mar09

Mar10

Mar11

Mar12

Mar13

Interest Coverage

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89.00

222.99

26.78

59.99

43.01

Invensys Semi-Annual Data
	Mar03	Sep04	Mar05	Sep05	Mar06	Sep06	Mar07	Sep07	Mar08	Sep08	Mar09	Sep09	Mar10	Sep10	Mar11	Sep11	Mar12	Sep12	Mar13	Sep13
Interest Coverage	Get a 7-Day Free Trial															15.60	-	8.80	-	26.67

Competitive Comparison of Invensys's Interest Coverage

For the Specialty Industrial Machinery subindustry, Invensys's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Invensys's Interest Coverage Distribution in the Industrial Products Industry

For the Industrial Products industry and Industrials sector, Invensys's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Invensys's Interest Coverage falls into.

Invensys Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Invensys's Interest Coverage for the fiscal year that ended in Mar. 2013 is calculated as

Here, for the fiscal year that ended in Mar. 2013, Invensys's Interest Expense was €-1 Mil. Its Operating Income was €50 Mil. And its Long-Term Debt & Capital Lease Obligation was €0 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Mar. 2013 )	/	Interest Expense (A: Mar. 2013 )
	=	-1	*	50.069	/	-1.164
	=	43.01

Invensys's Interest Coverage for the quarter that ended in Sep. 2013 is calculated as

Here, for the six months ended in Sep. 2013, Invensys's Interest Expense was €-4 Mil. Its Operating Income was €95 Mil. And its Long-Term Debt & Capital Lease Obligation was €0 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Sep. 2013 )	/	Interest Expense (Q: Sep. 2013 )
	=	-1	*	94.984	/	-3.562
	=	26.67

The higher the ratio, the stronger the company's Financial Strength is.

Invensys (FRA:SBPD) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

Invensys Interest Coverage Related Terms

Thank you for viewing the detailed overview of Invensys's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

Invensys (FRA:SBPD) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Industrial Products » Invensys PLC (FRA:SBPD) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

N/A

Address

Website

http://www.invensys.com

Invensys PLC is a technology company that works in partnership with industrial and commercial customers to design and supply advanced technologies that optimise operational performance and proï¬tability. The Company is grouped into four new business segments - Software, Industrial Automation, Energy Controls and Appliance. The Company's divisions include; Invensys Operations Management which is a technology, software and consulting business that creates and applies technologies to enable the safe and efï¬cient operation of industrial and commercial operations such as oil reï¬neries, fossil fuel and nuclear power plants, petrochemical works and other manufacturing sites. Invensys Controls designs, engineers and manufactures products, components, systems and services used in appliances, heating, air conditioning/cooling and refrigeration products across a range of industries in residential and commercial markets. The Software segment consists of the software businesses previously within Invensys Operations Management and includes Wonderware, SimSciTM and Avantis brands. Industrial Automation segment consists of the systems businesses of our Foxboro distributed control systems (DCS) and Triconex safety systems with the addition of the Foxboro measurement and instrumentation products previously within the equipment business of Invensys Operations Management. Energy Controls segment consists of the Eurotherm and IMServ businesses previously included within the equipment business of Invensys Operations Management, together with the residential heating and commercial businesses that were formerly part of Invensys Controls. Appliance segment consists of the Appliance controls line of business previously within Invensys Controls, together with the appliance replacement parts business formerly within Wholesale, also part of the former Invensys Controls.

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