CenterPoint Energy Inc (CNP)

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	2,052,000	1,868,000	1,959,000	2,222,878	2,463,836	2,762,781	2,952,754	2,887,790	2,827,772	2,913,756	2,841,729	3,092,759	3,139,764	3,107,780	3,010,781	2,679,786	1,043,794	1,049,803	1,316,811	1,434,821
Interest expense (ttm)	US$ in thousands	838,000	817,000	805,000	755,000	701,000	638,000	574,000	517,000	524,000	553,000	553,000	567,000	529,000	475,000	484,000	495,000	523,000	557,000	572,000	581,000
Interest coverage		2.45	2.29	2.43	2.94	3.51	4.33	5.14	5.59	5.40	5.27	5.14	5.45	5.94	6.54	6.22	5.41	2.00	1.88	2.30	2.47

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,052,000K ÷ $838,000K
= 2.45

CenterPoint Energy Inc's interest coverage ratio has shown fluctuations over the past few years.

As of December 31, 2024, the interest coverage ratio was 2.45, indicating that the company's operating income was 2.45 times its interest expenses.

The ratio had been relatively stable around the 5 to 6 range in the previous quarters, indicating a healthy ability to meet its interest obligations. However, there was a notable decline in the ratio in the most recent quarters, dropping to as low as 2.29 on September 30, 2024.

This downward trend could signify that CenterPoint Energy Inc may be facing challenges in generating sufficient operating income to cover its interest expenses, which could potentially increase the risk of default on its debt obligations.

Management should closely monitor the interest coverage ratio and take appropriate actions to improve its financial stability and ensure the company's ability to meet its debt obligations.