Bloomin Brands Inc (BLMN)

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	3,786	325,144	262,531	249,823	-172,924
Interest expense	US$ in thousands	62,593	52,169	53,176	57,614	64,442
Interest coverage		0.06	6.23	4.94	4.34	-2.68

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $3,786K ÷ $62,593K
= 0.06

Bloomin Brands Inc's interest coverage ratio has shown fluctuations over the years. In 2020, the company had an interest coverage ratio of -2.68, indicating that its operating income was insufficient to cover its interest expenses. However, there was a significant improvement in 2021 with the ratio increasing to 4.34 and further improvements in 2022 and 2023 to 4.94 and 6.23, respectively. These higher ratios suggest that Bloomin Brands Inc has been generating enough operating income to comfortably cover its interest obligations, indicating a stronger financial position.

However, in 2024, there was a sharp decline in the interest coverage ratio to 0.06, which could be a cause for concern. This drop indicates a significant decrease in the ability of the company to cover its interest payments from operating income. It is important for Bloomin Brands Inc to closely monitor this ratio and ensure that it remains at a healthy level to avoid potential financial distress.