The Coca-Cola Company (KO)
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 | 14,740,000 | 14,388,000 | 14,491,000 | 13,726,880 | 14,182,840 | 14,408,780 | 14,452,750 | 15,451,780 | 14,704,760 | 15,383,750 | 15,104,730 | 16,491,760 | 16,204,760 | 15,515,770 | 15,044,770 | 16,031,780 | 15,924,790 | 15,878,800 | 16,364,810 | 13,921,820 |
| Interest expense (ttm) | US$ in thousands | 1,656,000 | 1,638,000 | 1,581,000 | 1,537,000 | 1,527,000 | 1,418,000 | 1,248,000 | 1,072,000 | 882,000 | 743,000 | 755,000 | 1,337,000 | 1,597,000 | 1,742,000 | 2,192,000 | 1,879,000 | 1,630,000 | 1,555,000 | 1,125,000 | 894,000 |
| Interest coverage | 8.90 | 8.78 | 9.17 | 8.93 | 9.29 | 10.16 | 11.58 | 14.41 | 16.67 | 20.70 | 20.01 | 12.33 | 10.15 | 8.91 | 6.86 | 8.53 | 9.77 | 10.21 | 14.55 | 15.57 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $14,740,000K ÷ $1,656,000K
= 8.90
The interest coverage ratio of The Coca-Cola Company has been fluctuating over the years based on the provided data. The interest coverage ratio measures the ability of a company to meet its interest expenses from its operating income. A higher interest coverage ratio is generally considered favorable as it indicates that the company is more capable of servicing its debt obligations.
From March 31, 2020, to June 30, 2023, the interest coverage ratio of The Coca-Cola Company steadily declined from 15.57 to 11.58. This declining trend suggests that the company's ability to cover its interest expenses from its operating income weakened during this period.
However, there was a slight increase in the interest coverage ratio from June 30, 2023, to September 30, 2023, followed by a more significant jump from September 30, 2023, to June 30, 2024, where the ratio increased to 20.01 and 9.17, respectively. These increases indicate an improvement in the company's ability to cover its interest expenses during these quarters.
Overall, The Coca-Cola Company's interest coverage ratio experienced fluctuations but showed signs of improvement in the more recent quarters, suggesting a better ability to service its debt obligations from its operating income.
Peer comparison
Dec 31, 2024