Floor & Decor Holdings Inc (FND)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 321,428 | 396,760 | 338,992 | 215,594 | 159,181 |
| Interest expense | US$ in thousands | 9,897 | 11,138 | 4,924 | 8,389 | 8,801 |
| Interest coverage | 32.48 | 35.62 | 68.84 | 25.70 | 18.09 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $321,428K ÷ $9,897K
= 32.48
Floor & Decor Holdings Inc's interest coverage has shown a generally positive trend over the past five years. The interest coverage ratio measures the company's ability to meet its interest obligations from its operating income. A higher interest coverage ratio indicates that the company is more capable of covering its interest expenses.
In 2023, the interest coverage ratio was 32.48, which indicates that the company generated 32.48 times the earnings to cover its interest expenses for that year. This ratio decreased slightly compared to the previous year, 2022, when it was 35.62. Despite the decrease, the ratio remains at a healthy level well above 1, indicating a strong ability to cover interest payments.
Looking back further, in 2021, the interest coverage ratio was 68.84, which was significantly higher than in 2023. This suggests that the company's ability to cover interest expenses was very strong that year. In 2020 and 2019, the ratios were 25.70 and 18.09 respectively, showing a steady improvement in the company's ability to cover interest expenses over the years.
Overall, Floor & Decor Holdings Inc's interest coverage ratio has been strong and has generally improved over the past five years, indicating good financial health and a solid ability to meet its interest payment obligations.
Peer comparison
Dec 31, 2023