Ball Corporation (BALL)
Interest coverage
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 828,000 | 1,273,000 | 1,209,000 | 1,276,000 | 954,000 |
| Interest expense | US$ in thousands | 293,000 | 459,000 | 312,000 | 270,000 | 275,000 |
| Interest coverage | 2.83 | 2.77 | 3.88 | 4.73 | 3.47 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $828,000K ÷ $293,000K
= 2.83
Based on the provided data, the interest coverage ratio of Ball Corporation has shown some fluctuations over the past five years. The ratio was 3.47 on December 31, 2020, indicating that the company's operating income was able to cover its interest expenses approximately 3.47 times.
The interest coverage ratio improved to 4.73 on December 31, 2021, suggesting a stronger ability to pay interest obligations with operating income. However, there was a slight decline in the ratio to 3.88 on December 31, 2022, before decreasing further to 2.77 on December 31, 2023. This decline may raise concerns about the company's ability to cover its interest expenses comfortably.
The most recent data point shows an interest coverage ratio of 2.83 on December 31, 2024, indicating a slight improvement from the previous year but still below the levels seen in earlier years. A lower interest coverage ratio may suggest a higher risk for creditors and investors, as it indicates that the company's earnings may not be sufficient to cover its interest payments effectively.
Overall, the trend in Ball Corporation's interest coverage ratio highlights the importance of closely monitoring the company's ability to generate enough operating income to meet its interest obligations and maintain financial stability.
Peer comparison
Dec 31, 2024