Hershey Co (HSY)
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 | 2,726,717 | 2,411,824 | 2,580,695 | 2,807,239 | 2,532,217 | 2,482,061 | 2,300,714 | 2,207,757 | 2,136,169 | 2,196,482 | 2,221,871 | 2,221,873 | 2,055,738 | 2,020,380 | 2,048,783 | 1,967,594 | 1,808,576 | 1,760,108 | 1,607,808 | 1,647,429 |
| Interest expense (ttm) | US$ in thousands | 172,070 | 167,916 | 163,355 | 155,708 | 151,785 | 150,825 | 147,103 | 144,244 | 140,095 | 133,133 | 127,786 | 125,668 | 129,178 | 137,198 | 144,568 | 151,740 | 152,533 | 152,186 | 149,586 | 148,531 |
| Interest coverage | 15.85 | 14.36 | 15.80 | 18.03 | 16.68 | 16.46 | 15.64 | 15.31 | 15.25 | 16.50 | 17.39 | 17.68 | 15.91 | 14.73 | 14.17 | 12.97 | 11.86 | 11.57 | 10.75 | 11.09 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,726,717K ÷ $172,070K
= 15.85
The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio indicates that the company is more capable of meeting its interest obligations.
Analyzing the data provided for Hershey Co's interest coverage from March 31, 2020, to December 31, 2024, we observe a general increasing trend in the interest coverage ratio over the period.
The interest coverage ratio improved from 11.09 in March 31, 2020, to a peak of 18.03 in March 31, 2024. This indicates that Hershey Co's operating income has been sufficient to cover its interest expenses comfortably during this period.
Although there were some fluctuations in the interest coverage ratio over the years, the overall trend shows a positive financial performance in terms of the company's ability to meet its interest obligations. It seems that Hershey Co has been effectively managing its debt and generating enough operating income to cover its interest payments.
However, it's important to continue monitoring the interest coverage ratio to ensure the company's financial health and sustainability in the long run.
Peer comparison
Dec 31, 2024