The Chefs Warehouse Inc (CHEF)
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 | 128,207 | 100,943 | 85,738 | 10,811 | -102,660 |
| Interest expense | US$ in thousands | 48,675 | 45,474 | 43,849 | 17,587 | 20,946 |
| Interest coverage | 2.63 | 2.22 | 1.96 | 0.61 | -4.90 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $128,207K ÷ $48,675K
= 2.63
The interest coverage ratio of The Chefs Warehouse Inc has shown a significant improvement over the years. Starting at a concerning level of -4.90 in December 31, 2020, indicating the company was not generating sufficient earnings to cover its interest expenses, the ratio has steadily increased to 0.61 in December 31, 2021, 1.96 in December 31, 2022, 2.22 in December 31, 2023, and 2.63 in December 31, 2024.
This positive trend suggests that the company's ability to meet its interest obligations has strengthened over time. However, despite the improvements, the interest coverage ratio is still relatively low, indicating that the company's earnings may not be sufficient to cover its interest expenses comfortably. It would be advisable for investors and stakeholders to continue monitoring this ratio to ensure the company's financial health and ability to meet its debt obligations.
Peer comparison
Dec 31, 2024