Cleveland-Cliffs Inc (CLF)
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 | -756,000 | -391,000 | 193,000 | 670,000 | 677,000 | 595,000 | 457,000 | 814,000 | 1,939,000 | 3,240,000 | 4,702,000 | 4,929,000 | 4,012,000 | 3,000,000 | 1,389,000 | 114,000 | -142,000 | -167,600 | -84,000 | 350,800 |
| Interest expense (ttm) | US$ in thousands | 15,000 | 26,000 | 25,000 | 24,000 | 23,000 | 18,000 | 18,000 | 18,000 | 17,000 | 18,000 | 17,000 | 16,000 | 15,000 | 23,000 | 36,700 | 48,300 | 57,500 | 46,400 | 38,700 | 31,000 |
| Interest coverage | -50.40 | -15.04 | 7.72 | 27.92 | 29.43 | 33.06 | 25.39 | 45.22 | 114.06 | 180.00 | 276.59 | 308.06 | 267.47 | 130.43 | 37.85 | 2.36 | -2.47 | -3.61 | -2.17 | 11.32 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-756,000K ÷ $15,000K
= -50.40
The interest coverage ratio of Cleveland-Cliffs Inc has demonstrated significant fluctuations over the reported periods.
1. In the recent quarters of 2022 and early 2023, the interest coverage ratio improved significantly from around 2.36 in March 2021 to over 300 in March 2022. This indicates a substantial increase in the company's ability to cover interest payments with its operating income.
2. However, in the second half of 2023 and throughout 2024, there was a noticeable decline in the interest coverage ratio, dropping from 45.22 in March 2023 to -50.40 by December 2024. This negative ratio suggests that the company's operating income was insufficient to cover its interest expenses during these periods.
3. The drastic variations in the interest coverage ratio reflect potential changes in Cleveland-Cliffs' financial performance and debt management practices. It is essential for investors and stakeholders to closely monitor these trends to assess the company's ability to meet its debt obligations and generate sustainable earnings in the long term.
Peer comparison
Dec 31, 2024