GE Aerospace (GE)
Interest coverage
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 26,476,000 | 27,815,000 | 33,923,000 | 38,243,000 | 37,160,000 | 38,452,000 | 38,164,000 | 38,870,000 | 36,525,000 | 36,171,000 | 22,750,000 | 8,843,000 | -378,000 | -1,080,000 | -2,893,000 | -8,282,000 | -7,975,000 | -14,878,000 | -14,525,000 | -10,772,000 |
| Interest expense (ttm) | US$ in thousands | 1,001,000 | 1,073,000 | 1,108,000 | 1,127,000 | 1,118,000 | 1,122,000 | 1,226,000 | 1,353,000 | 1,622,000 | 1,748,000 | 1,820,000 | 1,914,000 | 1,876,000 | 2,187,000 | 2,470,000 | 2,979,000 | 3,273,000 | 3,491,000 | 4,025,000 | 4,019,000 |
| Interest coverage | 26.45 | 25.92 | 30.62 | 33.93 | 33.24 | 34.27 | 31.13 | 28.73 | 22.52 | 20.69 | 12.50 | 4.62 | -0.20 | -0.49 | -1.17 | -2.78 | -2.44 | -4.26 | -3.61 | -2.68 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $26,476,000K ÷ $1,001,000K
= 26.45
Based on the provided data, GE Aerospace's interest coverage ratio experienced significant fluctuations over the examined periods. The interest coverage ratio represents the company's ability to meet its interest obligations with its earnings before interest and taxes (EBIT).
From March 31, 2020, to December 31, 2021, the interest coverage ratio remained consistently negative, indicating that GE Aerospace was not generating sufficient earnings to cover its interest expenses. This negative trend raised concerns about the company's financial health and ability to manage its debt obligations effectively during this period.
However, starting from March 31, 2022, the interest coverage ratio showed a remarkable improvement, moving into positive territory. This improvement suggests that GE Aerospace's earnings were sufficient to cover its interest expenses, indicating better financial stability and a stronger ability to meet its debt obligations.
The interest coverage ratio continued to increase steadily from March 31, 2022, reaching its peak at December 31, 2023. This upward trend signifies an enhanced financial performance and a more secure financial position for GE Aerospace during this time frame.
Although there was a slight dip in the interest coverage ratio from March 31, 2024, to September 30, 2024, the values remained relatively high compared to the earlier periods. This indicates that GE Aerospace continued to maintain a healthy ability to cover its interest expenses with its earnings.
In conclusion, the interest coverage ratio of GE Aerospace improved significantly from being negative to reaching positive levels, reflecting enhanced financial strength and a better capacity to meet its interest obligations as the company progressed through the analyzed periods.
Peer comparison
Dec 31, 2024