Kellanova (K)
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 | 1,965,000 | 1,313,000 | 1,188,000 | 1,107,000 | 1,034,000 | 1,087,000 | 1,157,000 | 1,187,000 | 1,415,000 | 2,099,000 | 2,124,000 | 2,239,000 | 2,189,000 | 1,933,000 | 1,967,000 | 1,913,000 | 1,882,000 | 1,828,000 | 1,760,000 | 1,666,000 |
| Interest expense (ttm) | US$ in thousands | 311,000 | 299,000 | 299,000 | 289,000 | 276,000 | 287,000 | 251,000 | 232,000 | 218,000 | 200,000 | 216,000 | 220,000 | 223,000 | 257,000 | 265,000 | 276,000 | 281,000 | 259,000 | 268,000 | 274,000 |
| Interest coverage | 6.32 | 4.39 | 3.97 | 3.83 | 3.75 | 3.79 | 4.61 | 5.12 | 6.49 | 10.50 | 9.83 | 10.18 | 9.82 | 7.52 | 7.42 | 6.93 | 6.70 | 7.06 | 6.57 | 6.08 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,965,000K ÷ $311,000K
= 6.32
To analyze Kellanova's interest coverage, we can use the interest coverage ratio, which is calculated by dividing earnings before interest and taxes (EBIT) by interest expense. A higher interest coverage ratio indicates the company's ability to comfortably cover its interest obligations.
Looking at the data provided, Kellanova's interest coverage has fluctuated over the quarters. The interest coverage ratio ranged from a low of 3.75 on December 31, 2023, to a high of 10.50 on September 30, 2022. This variability suggests that the company's ability to cover its interest expenses has been inconsistent.
It is important to note that a consistently low interest coverage ratio can indicate financial distress, as it may imply that the company is struggling to generate enough operating income to meet its interest payments. Conversely, a high and increasing interest coverage ratio is a positive sign, indicating financial strength and a lower risk of default.
Therefore, Kellanova's management should closely monitor the interest coverage ratio to ensure that the company can meet its debt obligations and maintain financial stability in the long term. Additionally, potential investors and creditors would likely pay close attention to this metric when assessing the company's creditworthiness.
Peer comparison
Dec 31, 2024