Campbell Soup Company Common Stock (CPB)
Interest coverage
| Jul 31, 2024 | Jul 28, 2024 | Jul 31, 2023 | Jul 30, 2023 | Jul 31, 2022 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,000,000 | 1,006,000 | 1,312,000 | 1,316,000 | 1,163,000 |
| Interest expense | US$ in thousands | 249,000 | 249,000 | 188,000 | 188,000 | 189,000 |
| Interest coverage | 4.02 | 4.04 | 6.98 | 7.00 | 6.15 |
July 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $1,000,000K ÷ $249,000K
= 4.02
Campbell Soup Company's interest coverage ratio, which indicates the company's ability to cover its interest expenses with its operating income, has shown varying trends over the years. The interest coverage ratio was 6.15 on July 31, 2022, which indicates that the company earned 6.15 times its interest expenses. This ratio improved to 7.00 on July 30, 2023, and remained relatively stable at 6.98 on July 31, 2023.
However, there was a notable decline in the interest coverage ratio to 4.04 on July 28, 2024, and a further decrease to 4.02 on July 31, 2024. A declining interest coverage ratio could signal a potential risk for the company's financial health as it may indicate difficulties in meeting interest payments with its operating income.
Overall, while the interest coverage ratio has fluctuated over the years, it is important for Campbell Soup Company to closely monitor this ratio to ensure it maintains a healthy level of profitability to cover its interest obligations effectively.
Peer comparison
Jul 31, 2024