Avis Budget Group Inc (CAR)
Interest coverage
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | -1,550,000 | 1,665,000 | 2,057,000 | 2,531,000 | 2,820,000 | 3,030,000 | 3,520,000 | 3,963,000 | 4,337,000 | 4,340,000 | 3,866,000 | 3,216,000 | 2,259,000 | 2,035,000 | 1,103,000 | 7,000 | 19,000 | -2,580,000 | -2,324,000 | -1,620,000 |
| Interest expense (ttm) | US$ in thousands | 358,000 | 570,000 | 555,000 | 535,000 | 525,000 | 290,000 | 274,000 | 270,000 | 250,000 | 232,000 | 215,000 | 210,000 | 218,000 | 235,000 | 252,000 | 244,000 | 231,000 | 202,000 | 187,000 | 184,000 |
| Interest coverage | -4.33 | 2.92 | 3.71 | 4.73 | 5.37 | 10.45 | 12.85 | 14.68 | 17.35 | 18.71 | 17.98 | 15.31 | 10.36 | 8.66 | 4.38 | 0.03 | 0.08 | -12.77 | -12.43 | -8.80 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-1,550,000K ÷ $358,000K
= -4.33
Based on the data provided for Avis Budget Group Inc's interest coverage ratio over the indicated periods:
- The interest coverage ratio was negative in the first few quarters of 2020, indicating that the company's earnings were insufficient to cover its interest expenses, raising concerns about its financial health and ability to meet its debt obligations.
- From December 31, 2020, to June 30, 2021, the interest coverage ratio started to improve gradually, indicating that the company's earnings were starting to better cover its interest expenses.
- By the end of 2021 and throughout 2022, the interest coverage ratio showed significant improvement, reaching levels above 10. This implies that the company's earnings were more than sufficient to cover its interest expenses, signaling a stronger financial position and reduced risk of default.
- However, in the last quarter of 2024, the interest coverage ratio turned negative again, which may raise concerns about the company's ability to service its debt in that period.
Overall, the trend in Avis Budget Group Inc's interest coverage ratio shows variability over the past few years, with periods of improvement followed by a decline. It is essential for investors and stakeholders to monitor this ratio closely to assess the company's financial viability and debt repayment capacity.
Peer comparison
Dec 31, 2024