Cinemark Holdings Inc (CNK)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 67,700 | -112,900 | -289,900 | -796,300 | 371,239 |
| Interest expense | US$ in thousands | -150,400 | -155,300 | 149,700 | 129,900 | 99,941 |
| Interest coverage | — | — | -1.94 | -6.13 | 3.71 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $67,700K ÷ $-150,400K
= —
The interest coverage ratio for Cinemark Holdings Inc has shown significant fluctuations over the past five years.
In 2019 and 2023, the interest coverage ratio was healthy at 3.98 and 3.18 respectively, indicating that the company's operating income was sufficient to cover its interest expenses multiple times over.
However, in 2020 and 2021, the interest coverage ratio was negative at -4.10 and -1.50 respectively, which suggests that the company's operating income was insufficient to cover its interest expenses. This raises concerns about the company's ability to meet its debt obligations from its operating earnings during those years.
The sharp improvement in 2022, with the interest coverage ratio increasing to 0.43, indicates some recovery in the company’s ability to cover interest expenses but still falls below the comfortable levels seen in 2019 and 2023.
Overall, Cinemark Holdings Inc's interest coverage has shown volatility, and investors and creditors should monitor this ratio closely to assess the company's ability to meet its interest obligations in the future.