Foot Locker Inc (FL)
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 | 142,000 | 581,000 | 870,000 | 309,000 | 649,000 |
| Interest expense | US$ in thousands | 19,000 | 20,000 | 13,000 | 8,000 | 8,000 |
| Interest coverage | 7.47 | 29.05 | 66.92 | 38.62 | 81.12 |
February 3, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $142,000K ÷ $19,000K
= 7.47
Interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. For Foot Locker Inc, the interest coverage ratio has shown fluctuations over the past five years. In 2024, the ratio stands at 7.47, indicating that the company's operating income is sufficient to cover its interest expenses approximately 7.47 times. This represents a significant decline compared to the previous year when the ratio was 29.05, suggesting a decrease in the company's ability to cover interest expenses in the current year. However, when compared to 2022 and 2021, the interest coverage ratio is still higher, indicating a stronger ability to meet interest obligations.
Overall, the trend in Foot Locker Inc's interest coverage ratio shows variability, which could be a point of concern, particularly the significant drop from the previous year. Investors and creditors may need to closely monitor the company's financial performance and its ability to generate consistent operating income to cover interest expenses effectively.
Peer comparison
Feb 3, 2024