Walt Disney Company (DIS)

Interest coverage

		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	Dec 31, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	2,763,000	1,760,000	2,248,000	4,592,000	3,531,000	3,328,000	3,132,000	1,915,000	1,990,000	474,000	2,853,000	-2,932,000	-3,008,000	-518,000	1,487,000	8,708,000	14,657,000
Interest expense (ttm)	US$ in thousands	-1,910,000	-1,973,000	-1,192,000	-1,315,000	-1,445,000	-1,549,000	-1,654,000	-1,630,000	-1,589,000	-1,546,000	1,687,000	1,739,000	1,689,000	1,647,000	1,596,000	1,612,000	1,445,000
Interest coverage		—	—	—	—	—	—	—	—	—	—	1.69	-1.69	-1.78	-0.31	0.93	5.40	10.14

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,763,000K ÷ $-1,910,000K
= —

The interest coverage ratio measures a company's ability to pay its interest expenses from its operating income. A higher ratio indicates better ability to cover interest obligations. In the case of Walt Disney Company, the interest coverage ratio has been fluctuating over the years, reflecting changes in its financial performance.

In the most recent period, the interest coverage ratio was not provided, indicating a lack of available data to assess the company's ability to cover its interest expenses. Prior to that, there were significant variations in the ratio. In March 2021, there was a negative interest coverage ratio, indicating that the company's operating income was insufficient to cover its interest expenses. This negative ratio improved by June 2021, but remained low, indicating a precarious financial position.

However, starting from March 2020, the interest coverage ratio improved significantly, with ratios above 1, which suggests that the company's operating income was able to cover its interest expenses. The ratios peaked in December 2019 at 10.14, indicating a strong ability to meet interest obligations.

Overall, the analysis of Walt Disney Company's interest coverage ratio highlights the fluctuations in the company's financial performance in terms of its ability to cover interest expenses over the past few years. It is important for investors and analysts to closely monitor these ratios to assess the company's financial health and ability to meet its debt obligations in the future.