Antero Resources Corp (AR)

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	460	152,112	213,747	186,800	453,130	1,241,112	1,959,540	3,109,996	2,573,907	2,887,421	1,429,187	-275,283	23,856	-1,087,333	-1,157,368	-1,121,340	-953,447	-1,166,054	-1,397,823	-690,905
Interest expense (ttm)	US$ in thousands	4,000	3,299	3,596	3,844	4,000	27,721	55,178	88,530	125,372	144,000	161,088	176,838	181,868	185,036	187,665	189,513	199,872	207,199	206,910	209,263
Interest coverage		0.12	46.11	59.44	48.60	113.28	44.77	35.51	35.13	20.53	20.05	8.87	-1.56	0.13	-5.88	-6.17	-5.92	-4.77	-5.63	-6.76	-3.30

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $460K ÷ $4,000K
= 0.12

The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt. A higher ratio indicates that the company is more capable of covering its interest expenses.

Analyzing the interest coverage data for Antero Resources Corp, we observe fluctuations in the ratio over the reporting periods. The company experienced significant negative ratios in the range of -3.30 to -6.76 from March 2020 to June 2021, indicating a potential inability to cover its interest expenses with its operating income.

There was a notable improvement in the interest coverage ratio by the end of December 2021, with a positive ratio of 0.13. This positive trend continued into 2022, with ratios rising further to 8.87 in June 2022 and substantially improving to 113.28 by the end of December 2023. This significant increase suggests that the company's operating income was more than sufficient to cover its interest payments during this period.

However, in the latter half of 2024, the interest coverage ratio dropped to 0.12, indicating a potential strain on the company's ability to cover its interest obligations with its earnings.

Overall, the analysis of Antero Resources Corp's interest coverage reveals improvements in recent years, with periods of both strength and weakness. It is essential for investors and stakeholders to monitor this ratio to assess the company's financial health and ability to meet its debt obligations in the long term.