ConocoPhillips (COP)
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 | 14,780,000 | 15,962,000 | 16,820,000 | 16,492,000 | 16,478,000 | 17,531,000 | 20,764,000 | 25,082,000 | 27,910,000 | 27,040,000 | 23,104,000 | 18,540,000 | 13,635,000 | 8,197,000 | 4,288,000 | -34,000 | -3,263,000 | -827,000 | 1,404,000 | 4,673,000 |
| Interest expense (ttm) | US$ in thousands | 1,108,000 | 1,173,000 | 1,166,000 | 1,135,000 | 940,000 | 845,000 | 842,000 | 867,000 | 1,055,000 | 1,084,000 | 1,105,000 | 1,116,000 | 1,126,000 | 1,110,000 | 1,092,000 | 1,077,000 | 1,058,000 | 1,062,000 | 1,070,000 | 1,054,000 |
| Interest coverage | 13.34 | 13.61 | 14.43 | 14.53 | 17.53 | 20.75 | 24.66 | 28.93 | 26.45 | 24.94 | 20.91 | 16.61 | 12.11 | 7.38 | 3.93 | -0.03 | -3.08 | -0.78 | 1.31 | 4.43 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $14,780,000K ÷ $1,108,000K
= 13.34
ConocoPhillips' interest coverage ratio has shown a volatile trend over the past few years. The interest coverage ratio, which indicates the company's ability to pay its interest expenses with its earnings, was negative in several quarters in 2020 and early 2021, suggesting potential financial distress.
However, there has been a significant improvement in the interest coverage ratio from June 2021 onwards, indicating a strengthening ability to cover interest obligations. The ratio has shown a steady increase from single-digit values to over 20 in December 2022, indicating a more comfortable position in meeting interest payments.
The trend continued to be positive until September 2023, where the interest coverage ratio started declining. Despite the decrease, the interest coverage ratio remained above 10, suggesting the company still had a healthy ability to cover its interest expenses.
In the most recent quarter, December 2024, ConocoPhillips' interest coverage ratio stood at 13.34. Overall, the company's interest coverage ratio has improved significantly from its precarious levels in 2020, signaling a more stable financial position in recent years.
Peer comparison
Dec 31, 2024