Celanese Corporation (CE)
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 | -320,000 | 1,875,000 | 1,826,000 | 2,348,000 | 2,360,000 |
| Interest expense | US$ in thousands | 676,000 | 720,000 | 405,000 | 91,000 | 109,000 |
| Interest coverage | -0.47 | 2.60 | 4.51 | 25.80 | 21.65 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $-320,000K ÷ $676,000K
= -0.47
Celanese Corporation's interest coverage ratio has shown fluctuations over the years based on the provided data. As of December 31, 2020, the interest coverage ratio was 21.65, indicating that the company was able to cover its interest expenses comfortably. This ratio improved to 25.80 by December 31, 2021, suggesting a further increase in the company's ability to meet its interest obligations.
However, the interest coverage ratio experienced a significant decline by December 31, 2022, dropping to 4.51. This decrease may raise concerns about the company's ability to cover its interest expenses with its operating income. The trend worsened by the end of December 31, 2023, with the interest coverage ratio falling to 2.60, indicating a continued decline in the company's ability to cover its interest costs.
By December 31, 2024, Celanese Corporation's interest coverage ratio turned negative, standing at -0.47. A negative interest coverage ratio implies that the company's operating income is insufficient to cover its interest expenses, which may raise significant red flags regarding the company's financial health and sustainability. It is crucial for the company to monitor and improve its interest coverage ratio to ensure its long-term financial stability.
Peer comparison
Dec 31, 2024