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Meggitt Interest Coverage

: 3.22 (As of Jun. 2021)
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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. Meggitt's Operating Income for the six months ended in Jun. 2021 was £49 Mil. Meggitt's Interest Expense for the six months ended in Jun. 2021 was £-15 Mil. Meggitt's interest coverage for the quarter that ended in Jun. 2021 was 3.22. The higher the ratio, the stronger the company's financial strength is.

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

LSE:MGGT' s Interest Coverage Range Over the Past 10 Years
Min: 2.14   Med: 7   Max: 10.01
Current: 2.14

2.14
10.01

LSE:MGGT's Interest Coverage is ranked lower than
84% of the 160 Companies
in the Aerospace & Defense industry.

( Industry Median: 8.13 vs. LSE:MGGT: 2.14 )

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


Meggitt Interest Coverage Historical Data

The historical data trend for Meggitt'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.

* Premium members only.

Meggitt Annual Data
Trend Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20
Interest Coverage
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 5.99 6.07 5.68 7.00 -

Meggitt Semi-Annual Data
Dec11 Jun12 Dec12 Jun13 Dec13 Jun14 Dec14 Jun15 Dec15 Jun16 Dec16 Jun17 Dec17 Jun18 Dec18 Jun19 Dec19 Jun20 Dec20 Jun21
Interest Coverage 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 Premium Member Only Premium Member Only Premium Member Only 4.71 9.07 - 1.16 3.22

Competitive Comparison

For the Aerospace & Defense subindustry, Meggitt'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.

   

Meggitt Interest Coverage Distribution

For the Aerospace & Defense industry and Industrials sector, Meggitt's Interest Coverage distribution charts can be found below:

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



Meggitt 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.


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

Meggitt's Interest Coverage for the fiscal year that ended in Dec. 2020 is calculated as

Here, for the fiscal year that ended in Dec. 2020, Meggitt's Interest Expense was £-36 Mil. Its Operating Income was £-329 Mil. And its Long-Term Debt & Capital Lease Obligation was £926 Mil.

Meggitt did not have earnings to cover the interest expense.

Meggitt's Interest Coverage for the quarter that ended in Jun. 2021 is calculated as

Here, for the six months ended in Jun. 2021, Meggitt's Interest Expense was £-15 Mil. Its Operating Income was £49 Mil. And its Long-Term Debt & Capital Lease Obligation was £841 Mil.

Interest Coverage=-1* Operating Income (Q: Jun. 2021 )/Interest Expense (Q: Jun. 2021 )
=-1*49/-15.2
=3.22

* 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.


Meggitt  (LSE:MGGT) 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 .


Meggitt Interest Coverage Related Terms

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


Meggitt Business Description

Meggitt logo
Industry
Traded in Other Exchanges
Address
Ansty Business Park, Pilot Way, Coventry, GBR, CV7 9JU
Meggitt designs and manufactures high performance components and sub-systems for the aerospace, defense, and energy markets. Key products include aircraft wheels and brakes, fire and safety systems, sensors, fuel systems, and polymer seals. Of the EUR 1.9 billion group revenue reported in 2020, 43% is derived from civil aerospace markets, 46% from defense, and 11% from energy markets. The company commands a leading share within many of its product categories and enjoys a high level of sole-source positions on long-term civil and military programs. Activities are evenly split between production of original equipment and aftermarket services.

Meggitt Headlines

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