Caleres Inc (CAL)
Interest coverage
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 194,455 | 214,327 | 205,807 | -485,658 | 103,813 |
| Interest expense | US$ in thousands | 300 | 14,264 | 30,930 | 48,287 | 600 |
| Interest coverage | 648.18 | 15.03 | 6.65 | -10.06 | 173.02 |
February 3, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $194,455K ÷ $300K
= 648.18
The interest coverage ratio for Caleres Inc has shown a significant improvement over the past five years. In 2024, the interest coverage ratio reached an impressive 648.18, indicating that the company's operating income is more than sufficient to cover its interest expenses by a very comfortable margin. This represents a substantial increase from the previous year, where the ratio was 15.03.
The sharp increase in the interest coverage ratio in 2024 reflects the company's ability to generate strong operating income relative to its interest obligations. This improved ability to cover interest payments is a positive indicator of Caleres Inc's financial health and overall profitability.
While the interest coverage ratio was positive in 2022 and 2020, the ratios were notably lower compared to 2024, at 6.65 and 173.02, respectively. In 2021, the interest coverage ratio was negative at -10.06, indicating that the company's operating income was insufficient to cover its interest expenses during that year.
Overall, the trend in Caleres Inc's interest coverage ratio demonstrates a significant improvement in its financial performance and ability to meet its interest obligations, culminating in a very strong interest coverage ratio in 2024. This positive trend suggests that the company is effectively managing its debt and generating healthy profits to cover its interest expenses.
Peer comparison
Feb 3, 2024