Norfolk Southern Corporation (NSC)
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 | 4,089,000 | 3,804,000 | 3,004,000 | 2,506,000 | 3,042,000 | 3,411,000 | 3,885,000 | 4,509,000 | 4,822,000 | 4,757,000 | 4,637,000 | 4,582,000 | 4,524,000 | 4,401,000 | 4,130,000 | 3,587,000 | 3,155,000 | 3,108,000 | 3,247,000 | 3,675,000 |
| Interest expense (ttm) | US$ in thousands | 807,000 | 803,000 | 782,000 | 748,000 | 722,000 | 704,000 | 699,000 | 699,000 | 692,000 | 680,000 | 667,000 | 658,000 | 646,000 | 641,000 | 632,000 | 627,000 | 625,000 | 617,000 | 612,000 | 609,000 |
| Interest coverage | 5.07 | 4.74 | 3.84 | 3.35 | 4.21 | 4.85 | 5.56 | 6.45 | 6.97 | 7.00 | 6.95 | 6.96 | 7.00 | 6.87 | 6.53 | 5.72 | 5.05 | 5.04 | 5.31 | 6.03 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $4,089,000K ÷ $807,000K
= 5.07
The interest coverage ratio of Norfolk Southern Corporation has exhibited fluctuations over the period from March 31, 2020, to December 31, 2024. The ratio, which represents the company's ability to meet interest payments on its debt obligations, started at 6.03 in March 2020 and reached its peak at 7.00 by September 30, 2021, and again on September 30, 2022.
However, the interest coverage ratio began to decline after September 2022, dropping to 4.21 by December 31, 2023, indicating a potential strain on the company's ability to cover its interest expenses comfortably. The ratio continued to decrease further to 3.35 as of March 31, 2024, reflecting a significant deterioration in Norfolk Southern's capacity to service its debt.
While the ratio improved slightly to 5.07 by December 31, 2024, it remained below levels seen in earlier periods. This trend suggests that Norfolk Southern may be facing challenges in generating sufficient operating income to cover its interest obligations effectively. Continued monitoring of the interest coverage ratio will be important to assess the company's financial health and debt repayment capabilities.
Peer comparison
Dec 31, 2024
See also:
Norfolk Southern Corporation Interest Coverage (Quarterly Data)