Frontier Communications Parent Inc (FYBR)
Interest coverage
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 458,000 | 770,000 | 1,091,000 | 1,145,000 | 1,165,000 |
| Interest expense | US$ in thousands | 804,000 | 653,000 | 492,000 | 257 | 66 |
| Interest coverage | 0.57 | 1.18 | 2.22 | 4,455.25 | 17,651.52 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $458,000K ÷ $804,000K
= 0.57
The interest coverage ratio for Frontier Communications Parent Inc has been on a declining trend over the years. In December 31, 2020, the interest coverage ratio was a robust 17,651.52 times, indicating that the company's operating income was more than sufficient to cover its interest expenses. However, this ratio dropped significantly to 4,455.25 times by December 31, 2021, suggesting a potential decrease in profitability relative to its interest obligations.
The trend continued downwards with the interest coverage ratio plummeting to 2.22 times by December 31, 2022, and further to 1.18 times by December 31, 2023. These declining ratios might indicate a heightened risk as the company's ability to cover its interest payments weakened over these periods.
In the most recent data available, as of December 31, 2024, the interest coverage ratio fell to 0.57 times, raising concerns about Frontier Communications Parent Inc's financial health and its ability to meet interest payments from its operating income. Such a low ratio could suggest that the company's earnings are insufficient to cover its interest expenses, potentially leading to financial distress and solvency issues.
Overall, the declining trend in interest coverage ratios for Frontier Communications Parent Inc raises red flags about its financial stability and highlights the need for close monitoring of the company's debt servicing capabilities.
Peer comparison
Dec 31, 2024