Barka Desalination Co (MUS:BRDE) Interest Coverage : 1.02 (As of Dec. 2023)

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What is Barka Desalination Co 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. Barka Desalination Co's Operating Income for the six months ended in Dec. 2023 was ر.ع4.97 Mil. Barka Desalination Co's Interest Expense for the six months ended in Dec. 2023 was ر.ع-4.88 Mil. Barka Desalination Co's interest coverage for the quarter that ended in Dec. 2023 was 1.02. The higher the ratio, the stronger the company's financial strength is.

Warning Sign:

Ben Graham prefers companies' interest coverage to be at least 5. Barka Desalination Co interest coverage is 1.02, which is low.

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

MUS:BRDE' s Interest Coverage Range Over the Past 10 Years
Min: 1.02 Med: 1.37 Max: 1.64
Current: 1.02

MUS:BRDE's Interest Coverage is ranked worse than
92.62% of 447 companies
in the Utilities - Regulated industry
Industry Median: 3.78 vs MUS:BRDE: 1.02

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

Barka Desalination Co Interest Coverage Historical Data

The historical data trend for Barka Desalination Co'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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Barka Desalination Co Interest Coverage Chart

Barka Desalination Co Annual Data

Trend

Dec21

Dec22

Dec23

Interest Coverage

1.37

1.64

1.02

Barka Desalination Co Semi-Annual Data
	Dec21	Dec22	Dec23
Interest Coverage	1.37	1.64	1.02

Competitive Comparison of Barka Desalination Co's Interest Coverage

For the Utilities - Regulated Water subindustry, Barka Desalination Co'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.

Barka Desalination Co's Interest Coverage Distribution in the Utilities - Regulated Industry

For the Utilities - Regulated industry and Utilities sector, Barka Desalination Co's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Barka Desalination Co's Interest Coverage falls into.

Barka Desalination Co 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.

Barka Desalination Co's Interest Coverage for the fiscal year that ended in Dec. 2023 is calculated as

Here, for the fiscal year that ended in Dec. 2023, Barka Desalination Co's Interest Expense was ر.ع-4.88 Mil. Its Operating Income was ر.ع4.97 Mil. And its Long-Term Debt & Capital Lease Obligation was ر.ع74.03 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Dec. 2023 )	/	Interest Expense (A: Dec. 2023 )
	=	-1	*	4.968	/	-4.883
	=	1.02

Barka Desalination Co's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the six months ended in Dec. 2023, Barka Desalination Co's Interest Expense was ر.ع-4.88 Mil. Its Operating Income was ر.ع4.97 Mil. And its Long-Term Debt & Capital Lease Obligation was ر.ع74.03 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Dec. 2023 )	/	Interest Expense (Q: Dec. 2023 )
	=	-1	*	4.968	/	-4.883
	=	1.02

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

Barka Desalination Co (MUS:BRDE) 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 .

Barka Desalination Co Interest Coverage Related Terms

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

Barka Desalination Co (MUS:BRDE) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Utilities » Utilities - Regulated » Barka Desalination Co (MUS:BRDE) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

N/A

Address

Al Wilaj Street, Way No 1013 Al Qurm, PO Box 252, Building No 1022, Office No 16, 1st Floor, Bousher, Muscat, OMN, 103

Website

https://www.barkadesalination.com

Barka Desalination Co is engaged in operation of seawater desalination plant in Oman. The objectives of the Company are to acquire, develop, finance, design, construct, operate, maintain a desalination facility at Barka Independent Water Project, a sea water reverse osmosis (SWRO) plant located in Barka, South Batinah Governorate, Sultanate of Oman.

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