CNX Resources Corp (CNX)

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	-224,887	2,366,200	-84,258	-485,357	-487,056
Interest expense	US$ in thousands	150,594	143,278	127,689	151,156	170,806
Interest coverage		-1.49	16.51	-0.66	-3.21	-2.85

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $-224,887K ÷ $150,594K
= -1.49

Interest coverage ratio is a significant financial metric that indicates a company's ability to meet its interest obligations from its operating income. A higher ratio is typically favorable as it suggests the company is generating enough operating income to cover its interest payments comfortably, whereas a lower ratio may indicate financial distress.

In the case of CNX Resources Corp, the interest coverage ratio has been fluctuating over the years. In December 2020 and December 2021, the company had negative interest coverage ratios of -2.85 and -3.21 respectively. This indicates that CNX Resources Corp's operating income was insufficient to cover its interest expenses during those periods.

In December 2022, the interest coverage ratio improved slightly to -0.66 but remained negative, indicating continued challenges in meeting interest obligations from operating income.

However, there was a significant improvement in December 2023, with the interest coverage ratio rising to 16.51. This sharp increase indicates that CNX Resources Corp's operating income substantially exceeded its interest expenses, reflecting a strong ability to comfortably cover interest payments.

Subsequently, in December 2024, the interest coverage ratio decreased once again to -1.49, indicating a potential strain on the company's ability to cover interest obligations with operating income during that period.

Overall, the fluctuating interest coverage ratios of CNX Resources Corp suggest varying levels of financial health and ability to meet interest payment obligations from operating income over the years analyzed. It would be important for the company to improve its operational performance to ensure consistent and adequate coverage of its interest expenses in the future.