Bath & Body Works Inc. (BBWI)
Interest coverage
| Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Feb 1, 2020 | Nov 2, 2019 | Aug 3, 2019 | May 4, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,366,000 | 1,325,000 | 1,287,000 | 1,318,000 | 1,398,000 | 1,609,000 | 1,633,000 | 1,932,000 | 2,070,000 | 2,359,000 | 2,649,000 | 2,150,000 | 1,416,000 | 289,000 | -415,000 | -322,000 | 152,000 | 915,000 | 1,155,000 | 1,245,000 |
| Interest expense (ttm) | US$ in thousands | 345,000 | 345,000 | 347,000 | 347,000 | 347,000 | 348,000 | 353,000 | 364,000 | 389,000 | 417,000 | 445,000 | 452,000 | 435,000 | 404,000 | 377,000 | 368,000 | 370,000 | 379,000 | 383,000 | 386,000 |
| Interest coverage | 3.96 | 3.84 | 3.71 | 3.80 | 4.03 | 4.62 | 4.63 | 5.31 | 5.32 | 5.66 | 5.95 | 4.76 | 3.26 | 0.72 | -1.10 | -0.88 | 0.41 | 2.41 | 3.02 | 3.23 |
February 3, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,366,000K ÷ $345,000K
= 3.96
Based on the interest coverage ratios provided for Bath & Body Works Inc. over multiple periods, the company's ability to cover its interest expenses fluctuates.
The interest coverage ratio measures the company's ability to meet its interest payments on outstanding debt using its operating income. A higher ratio indicates a stronger ability to meet interest obligations.
From Feb 3, 2024, to Oct 30, 2021, Bath & Body Works Inc. generally maintained healthy interest coverage ratios above 3.5, with the ratio peaking at 5.95 on Jul 31, 2021. This indicates that during this period, the company's operating income was sufficient to cover its interest expenses comfortably.
However, notable declines in interest coverage were observed in the following periods: May 1, 2021, Jan 30, 2021, and Oct 31, 2020, with ratios falling below 1. This suggests that during these periods, the company's operating income may have been insufficient to cover its interest payments, potentially signaling financial strain.
Overall, it is crucial for Bath & Body Works Inc. to monitor and maintain healthy interest coverage ratios consistently to demonstrate financial stability and ensure the ability to meet debt obligations in the long term.
Peer comparison
Feb 3, 2024