Hilton Worldwide Holdings Inc (HLT)

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	2,348,000	2,250,000	2,278,000	2,224,000	2,146,000	2,269,000	2,244,000	2,180,000	2,147,000	1,960,000	1,765,000	1,382,000	960,000	394,000	-41,000	-583,000	-396,000	773,000	1,031,000	1,603,000
Interest expense (ttm)	US$ in thousands	569,000	536,000	509,000	479,000	464,000	460,000	453,000	441,000	415,000	390,000	382,000	384,000	397,000	415,000	433,000	438,000	429,000	426,000	415,000	410,000
Interest coverage		4.13	4.20	4.48	4.64	4.62	4.93	4.95	4.94	5.17	5.03	4.62	3.60	2.42	0.95	-0.09	-1.33	-0.92	1.81	2.48	3.91

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,348,000K ÷ $569,000K
= 4.13

The interest coverage ratio measures a company's ability to pay its interest expenses on outstanding debt. A higher ratio indicates the company is more capable of meeting its interest obligations.

From March 2020 to September 2021, Hilton Worldwide's interest coverage ratio decreased steadily, indicating a decline in its ability to cover interest expenses.

However, from December 2021 to December 2024, there was a positive trend in the interest coverage ratio, with values consistently above 4. This improvement suggests that Hilton Worldwide's ability to cover its interest expenses has strengthened over this period.

Overall, the interest coverage ratio for Hilton Worldwide Holdings Inc has shown variability but has demonstrated a positive trend towards improved financial health and a better ability to meet its interest obligations.