Chemours Co (CC)
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 | 372,000 | 274,000 | 303,000 | -224,000 | -108,000 | -115,000 | 148,000 | 733,000 | 832,000 | 1,067,000 | 1,012,000 | 904,000 | 709,000 | 608,000 | 456,000 | 434,000 | 448,000 | -59,000 | -39,000 | 56,000 |
| Interest expense (ttm) | US$ in thousands | 265,000 | 261,000 | 247,000 | 229,000 | 208,000 | 185,000 | 171,000 | 163,000 | 162,000 | 165,000 | 169,000 | 176,000 | 184,000 | 191,000 | 199,000 | 205,000 | 210,000 | 212,000 | 212,000 | 211,000 |
| Interest coverage | 1.40 | 1.05 | 1.23 | -0.98 | -0.52 | -0.62 | 0.87 | 4.50 | 5.14 | 6.47 | 5.99 | 5.14 | 3.85 | 3.18 | 2.29 | 2.12 | 2.13 | -0.28 | -0.18 | 0.27 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $372,000K ÷ $265,000K
= 1.40
The interest coverage ratio is a financial metric used to measure a company's ability to meet its interest payments on outstanding debt. It is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expenses.
Analyzing the interest coverage data of Chemours Co from March 2020 to December 2024, we observe fluctuations in the ratio over the period.
- From March 2020 to September 2020, the interest coverage ratio was significantly below 1, indicating that the company's earnings were insufficient to cover its interest expenses, raising concerns about its ability to meet its debt obligations.
- However, from December 2020 onwards, the interest coverage ratio improved and consistently remained above 1. This indicates that the company's earnings were able to cover its interest payments adequately, providing a positive sign of financial health and stability.
- The ratio showed a positive trend from March 2021 to September 2022, reaching its peak at 6.47 in September 2022, indicating a strong ability to service its debt.
- There was a slight decline in the ratio from September 2022 to March 2024, with the ratio falling below 1 again in several quarters. This suggests a potential strain on the company's ability to meet interest obligations during this period.
- In the latter quarters of December 2024, the interest coverage ratio improved but remained relatively modest, indicating a need for the company to continue monitoring and managing its debt levels effectively.
Overall, the analysis highlights the importance of a healthy interest coverage ratio in ensuring a company's ability to manage its debt obligations. It also underscores the need for ongoing financial supervision and strategic planning to maintain a stable financial position.
Peer comparison
Dec 31, 2024