Avanta Serviced Office Group (LSE:ASOA) Interest Coverage: 2.09 (As of Jun. 2014) — Near Median


What is Avanta Serviced Office Group Interest Coverage?

Avanta Serviced Office Group LSE:ASOA Interest Coverage is 2.09 as of Jun. 2014, which is 1% below its 10-year median of 2.12. The stock has 3 warning signs investors should review.

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. Avanta Serviced Office Group's Operating Income for the six months ended in Jun. 2014 was £2.50 Mil. Avanta Serviced Office Group's Interest Expense for the six months ended in Jun. 2014 was £-1.20 Mil. Avanta Serviced Office Group's interest coverage for the quarter that ended in Jun. 2014 was 2.09. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Avanta Serviced Office Group's Interest Coverage or its related term are showing as below:


LSE:ASOA's Interest Coverage is not ranked *
in the Asset Management industry.
Industry Median: 43.13
* 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.

Avanta Serviced Office Group  (LSE:ASOA) 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 .

Avanta Serviced Office Group Interest Coverage Related Terms

Avanta Serviced Office Group Interest Coverage Historical Data

* Premium members only.

The historical data trend for Avanta Serviced Office Group'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.

Avanta Serviced Office Group Interest Coverage Chart

Avanta Serviced Office Group Annual Data
Trend Dec04 Dec05 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13
Interest Coverage
Get a 7-Day Free Trial Premium Member Only Premium Member Only 0.44 1.95 0.00 0.00 0.00

Avanta Serviced Office Group Semi-Annual Data
Dec04 Jun05 Dec05 Jun06 Dec06 Jun07 Dec07 Jun08 Dec08 Jun09 Dec09 Jun10 Dec10 Jun11 Dec11 Jun12 Dec12 Jun13 Dec13 Jun14
Interest Coverage Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.77 0.00 0.00 0.00 2.09

LSE:ASOA vs AINC, HCAP, OCCAF: Interest Coverage Comparison

For the Asset Management subindustry, Avanta Serviced Office Group'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.

Avanta Serviced Office Group Interest Coverage vs Asset Management Industry

For the Asset Management industry and Financial Services sector, Avanta Serviced Office Group's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Avanta Serviced Office Group's Interest Coverage falls into.


Avanta Serviced Office Group 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.

Avanta Serviced Office Group's Interest Coverage for the fiscal year that ended in Dec. 2013 is calculated as

Here, for the fiscal year that ended in Dec. 2013, Avanta Serviced Office Group's Interest Expense was £-0.29 Mil. Its Operating Income was £-1.34 Mil. And its Long-Term Debt & Capital Lease Obligation was £4.51 Mil.

Avanta Serviced Office Group did not have earnings to cover the interest expense.

Avanta Serviced Office Group's Interest Coverage for the quarter that ended in Jun. 2014 is calculated as

Here, for the six months ended in Jun. 2014, Avanta Serviced Office Group's Interest Expense was £-1.20 Mil. Its Operating Income was £2.50 Mil. And its Long-Term Debt & Capital Lease Obligation was £0.01 Mil.

Interest Coverage=-1* Operating Income (Q: Jun. 2014 )/Interest Expense (Q: Jun. 2014 )
=-1*2.503/-1.199
=2.09

* 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.

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

Frequently Asked Questions Learn more about Interest Coverage →
What does a Interest Coverage of 2.09 mean?
Avanta Serviced Office Group (LSE:ASOA) has a Interest Coverage of 2.09 as of Jun. 2014. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on Avanta Serviced Office Group and its competitors. This is near median its historical median of 2.12.
Is Avanta Serviced Office Group's Interest Coverage too high?
Avanta Serviced Office Group's current Interest Coverage of 2.09 is near median its 10-year median of 2.12. The Asset Management industry median Interest Coverage is 43.13. Avanta Serviced Office Group's value of 2.09 is 95.2% below this industry median.
How does Avanta Serviced Office Group's Interest Coverage compare to AINC and HCAP?
Avanta Serviced Office Group's Interest Coverage of 2.09 can be compared against companies in the Asset Management industry. The industry median Interest Coverage is 43.13. Avanta Serviced Office Group's value of 2.09 is 95.2% below this benchmark. While the company's 10-year median is 2.12 vs. the industry median of 43.13, Avanta Serviced Office Group has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Interest Coverage for an Asset Management company?
The median Interest Coverage among Asset Management companies is 43.13, based on 476 companies in the industry. Companies in the top quartile (top 25%) have a Interest Coverage significantly above this median, while those in the bottom quartile fall well below. However, Interest Coverage should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Avanta Serviced Office Group's current Interest Coverage of 2.09 is 95.2% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Interest Coverage mean?
A high Interest Coverage can signal that a stock is expensive relative to its fundamentals. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on Avanta Serviced Office Group and its competitors. For the Asset Management industry, the median Interest Coverage is 43.13 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Avanta Serviced Office Group's current Interest Coverage is 2.09, which is near median its own 10-year median of 2.12. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Avanta Serviced Office Group stock overvalued right now?
Avanta Serviced Office Group (LSE:ASOA) has a current Interest Coverage of 2.09. The current Interest Coverage is 2.09, which is near median its 10-year median of 2.12 and 95.2% below the Asset Management industry median of 43.13. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Interest Coverage calculated?
Interest Coverage is calculated from a company's financial statements. For Avanta Serviced Office Group (LSE:ASOA), the current Interest Coverage is 2.09 as of Jun. 2014. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.

Avanta Serviced Office Group Business Description

Serviced Office Group PLC is engaged in the ownership and operation of serviced office accommodation. Its reportable segments are Serviced office business and Managed serviced offices. Serviced office business undertaken in the group's freehold and leasehold properties; and Managed serviced office business undertaken under management contracts on behalf of third parties. The Group operates solely from the UK.