American Airlines Group (AAL)
Interest coverage
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 2,691,000 | 2,108,000 | 1,866,000 | 2,793,000 | 3,266,000 | 4,257,000 | 5,567,000 | 4,327,000 | 2,147,000 | -118,000 | -593,000 | -1,169,000 | -748,000 | -2,458,000 | -5,895,000 | -8,795,000 | -10,226,000 | -6,957,000 | -3,361,000 | 201,000 |
| Interest expense (ttm) | US$ in thousands | 1,933,000 | 1,982,000 | 2,039,000 | 2,101,000 | 2,144,000 | 2,157,000 | 2,119,000 | 2,039,000 | 1,962,000 | 1,898,000 | 1,875,000 | 1,893,000 | 1,801,000 | 1,709,000 | 1,573,000 | 1,341,000 | 1,227,000 | 1,116,000 | 1,060,000 | 1,081,000 |
| Interest coverage | 1.39 | 1.06 | 0.92 | 1.33 | 1.52 | 1.97 | 2.63 | 2.12 | 1.09 | -0.06 | -0.32 | -0.62 | -0.42 | -1.44 | -3.75 | -6.56 | -8.33 | -6.23 | -3.17 | 0.19 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,691,000K ÷ $1,933,000K
= 1.39
The interest coverage ratio of American Airlines Group has displayed significant fluctuations over the analyzed periods. During the early part of the observation period, from March 2020 to September 2021, the interest coverage ratio was consistently negative, indicating that the company's operating income was insufficient to cover its interest expenses.
However, starting from December 2021, there has been a notable improvement in the interest coverage ratio, turning positive and reaching a peak of 2.63 by June 2023. This positive trend suggests that American Airlines Group has been generating sufficient operating income to comfortably cover its interest expenses during this period.
Despite the improving trend, the interest coverage ratio experienced a slight decrease towards the end of the analyzed period, settling at 1.39 by December 2024. Overall, the shifting dynamics of the interest coverage ratio reflect the company's ability to manage its debt obligations relative to its operating income, showcasing both areas of improvement and potential challenges in the future.
Peer comparison
Dec 31, 2024