National Vision Holdings Inc (EYE)

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 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Earnings before interest and tax (EBIT) (ttm) US$ in thousands -46,826 -43,347 46,609 57,255 61,275 79,011 114,363 150,821 174,937 223,884 227,967 131,540 87,007 38,472 -5,210 58,090 73,575 45,827 32,632 35,903
Interest expense (ttm) US$ in thousands 6,093 6,220 6,391 6,562 2,342 2,514 2,658 2,790 8,473 21,654 34,239 49,985 51,110 47,816 44,291 37,666 39,272 37,840 37,471 37,031
Interest coverage -7.69 -6.97 7.29 8.73 26.16 31.43 43.03 54.06 20.65 10.34 6.66 2.63 1.70 0.80 -0.12 1.54 1.87 1.21 0.87 0.97

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-46,826K ÷ $6,093K
= -7.69

The interest coverage ratio is a measure of a company's ability to pay its interest expenses on outstanding debt. A higher interest coverage ratio indicates that the company is more capable of meeting its interest obligations.

Looking at the historical trend of National Vision Holdings Inc's interest coverage ratio, we can see significant fluctuations over the past few years. The interest coverage ratio was positive and healthy in the earlier periods, indicating that the company had sufficient earnings to cover its interest expenses. However, in more recent periods, the interest coverage ratio has turned negative, suggesting that the company's earnings are insufficient to cover its interest payments.

This negative trend in the interest coverage ratio raises concerns about the company's ability to service its debt in the short term. The declining interest coverage ratio may indicate financial distress or a need to reevaluate the company's debt levels and overall financial strategy.

It is crucial for National Vision Holdings Inc to closely monitor and manage its interest coverage ratio to ensure it can meet its debt obligations and maintain financial stability. Additional measures such as improving profitability, reducing debt levels, or refinancing debt at lower interest rates may be necessary to strengthen the company's financial position and improve its interest coverage ratio in the future.


Peer comparison

Dec 31, 2023

Company name
Symbol
Interest coverage
National Vision Holdings Inc
EYE
-7.69
STAAR Surgical Company
STAA
2,341.42
The Cooper Companies Inc.
COO
4.77