Alaska Air Group Inc (ALK)
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 | 805,000 | 757,000 | 724,000 | 780,000 | 751,000 | 809,000 | 957,000 | 824,000 | 821,000 | 750,000 | 527,000 | 120,000 | 157,000 | -497,000 | -1,313,000 | -1,568,000 | -1,731,000 | -897,000 | 82,000 | 721,000 |
| Interest expense (ttm) | US$ in thousands | 142,000 | 127,000 | 117,000 | 108,000 | 100,000 | 87,000 | 88,000 | 90,000 | 94,000 | 101,000 | 100,000 | 113,000 | 117,000 | 123,000 | 126,000 | 106,000 | 87,000 | 70,000 | 54,000 | 55,000 |
| Interest coverage | 5.67 | 5.96 | 6.19 | 7.22 | 7.51 | 9.30 | 10.88 | 9.16 | 8.73 | 7.43 | 5.27 | 1.06 | 1.34 | -4.04 | -10.42 | -14.79 | -19.90 | -12.81 | 1.52 | 13.11 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $805,000K ÷ $142,000K
= 5.67
The interest coverage ratio of Alaska Air Group Inc has displayed fluctuating trends over the provided time period.
As of March 31, 2020, the interest coverage ratio was 13.11, indicating a strong ability to cover interest expenses. However, in the subsequent quarters, the ratio dropped significantly, reaching its lowest point at -19.90 on December 31, 2020, and continuing to show negative values until June 30, 2021. These negative values suggest that the company was not generating enough operating income to cover its interest expenses during this period.
From June 30, 2021, the interest coverage ratio started to improve steadily, turning positive by December 31, 2021, and continuing to increase through the following quarters. By December 31, 2024, the interest coverage ratio had reached a satisfactory level of 5.67.
Overall, the fluctuating trend in the interest coverage ratio indicates that Alaska Air Group Inc faced challenges in covering its interest expenses in the past but has since managed to strengthen its ability to do so. It is important for investors and stakeholders to monitor this ratio to assess the company's financial health and its ability to meet its debt obligations.
Peer comparison
Dec 31, 2024