Peabody Energy Corp (BTU)

Interest coverage

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Earnings before interest and tax (EBIT) US$ in thousands 1,074,700 1,381,600 432,200 -1,728,300 -21,300
Interest expense US$ in thousands 59,800 140,300 183,400 139,800 144,000
Interest coverage 17.97 9.85 2.36 -12.36 -0.15

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $1,074,700K ÷ $59,800K
= 17.97

The interest coverage ratio of Peabody Energy Corp has shown significant improvement over the past five years. In 2023, the interest coverage ratio stands at 17.97, indicating the company's ability to cover its interest expenses nearly 18 times over from its operating income. This represents a substantial increase compared to the ratios of 9.85 in 2022 and 2.36 in 2021.

The negative interest coverage ratios in 2020 and 2019 (-12.36 and -0.15, respectively) signify that the company's operating income was insufficient to cover its interest expenses during those years. However, the positive trend in recent years demonstrates a strengthening ability to meet its interest obligations.

Overall, the improving interest coverage ratio suggests that Peabody Energy Corp has enhanced its financial stability and operational efficiency, which is crucial for its long-term sustainability and growth.


Peer comparison

Dec 31, 2023

Company name
Symbol
Interest coverage
Peabody Energy Corp
BTU
17.97
Alpha Metallurgical Resources Inc
AMR
123.12
Arch Resources Inc
ARCH
38.21