Designer Brands Inc (DBI)
Interest coverage
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 73,036 | 174,633 | 205,223 | -584,615 | 127,299 |
| Interest expense | US$ in thousands | 32,993 | 15,099 | 32,198 | 24,032 | 8,914 |
| Interest coverage | 2.21 | 11.57 | 6.37 | -24.33 | 14.28 |
February 3, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $73,036K ÷ $32,993K
= 2.21
The interest coverage ratio for Designer Brands Inc has fluctuated over the past five years. In February 2024, the interest coverage ratio stood at 2.21, indicating that the company generated operating income 2.21 times greater than its interest expense. This represents a significant decrease from the previous year where the ratio was 11.57.
Comparing to historical data, the interest coverage ratio was relatively stable in the years prior to 2021, with ratios of 6.37 in 2022 and 14.28 in 2020. However, in January 2021, the ratio plummeted to -24.33, signaling that the company's operating income was insufficient to cover its interest obligations for that period.
The significant decline in the interest coverage ratio in 2021 followed by a rebound in subsequent years suggests fluctuations in the company's ability to cover its interest payments with operating income. Investors and creditors should closely monitor Designer Brands Inc's interest coverage ratio to assess the company's financial health and ability to meet its debt obligations.
Peer comparison
Feb 3, 2024