Hasbro Inc (HAS)
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 | 668,200 | -517,000 | -1,021,400 | -1,428,600 | -1,522,800 | -442,300 | -66,900 | 336,000 | 432,500 | 681,200 | 840,400 | 706,000 | 761,600 | 817,202 | 799,102 | 717,802 | 523,102 | 670,743 | 604,653 | 626,879 |
| Interest expense (ttm) | US$ in thousands | 171,200 | 174,000 | 174,900 | 178,500 | 186,300 | 185,800 | 180,600 | 175,700 | 171,000 | 167,600 | 169,000 | 173,400 | 179,700 | 184,728 | 190,828 | 194,328 | 201,128 | 188,482 | 161,846 | 134,264 |
| Interest coverage | 3.90 | -2.97 | -5.84 | -8.00 | -8.17 | -2.38 | -0.37 | 1.91 | 2.53 | 4.06 | 4.97 | 4.07 | 4.24 | 4.42 | 4.19 | 3.69 | 2.60 | 3.56 | 3.74 | 4.67 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $668,200K ÷ $171,200K
= 3.90
The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A ratio above 1 indicates the company is generating enough earnings to easily cover interest payments.
Looking at the data provided for Hasbro Inc, we observe the following trend in the interest coverage ratio over the given periods:
- The interest coverage ratio fluctuated between 3.56 and 4.97 from March 31, 2020, to June 30, 2022, indicating a relatively stable ability to cover interest expenses comfortably.
- There was a significant drop in the ratio to 1.91 on March 31, 2023, and further decreased to negative values in subsequent periods, implying that Hasbro Inc may have faced challenges in meeting its interest obligations with its operating income.
- The negative interest coverage ratios observed from June 30, 2023, to December 31, 2024, raise concerns about the company's financial health, as it suggests that the operating income was insufficient to cover interest expenses during those periods.
Overall, the trend in Hasbro Inc's interest coverage ratio highlights periods of solid coverage followed by a notable decline and subsequent financial strain, indicating the importance for the company to closely monitor its ability to meet interest payments in relation to its operating earnings.