News Corp A (NWSA)
Interest coverage
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | -2,826,000 | -2,779,000 | -2,720,000 | -2,829,000 | -4,456,000 |
| Interest expense | US$ in thousands | 85,000 | 100,000 | 99,000 | 53,000 | 25,000 |
| Interest coverage | -33.25 | -27.79 | -27.47 | -53.38 | -178.24 |
June 30, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $-2,826,000K ÷ $85,000K
= -33.25
The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt. A higher interest coverage ratio indicates a stronger ability to cover interest expenses using operating income.
Looking at the historical trend of News Corp A's interest coverage ratio, we observe a significant decline over the past five years. On June 30, 2020, the interest coverage ratio was at a very low level of -178.24, indicating a substantial inability to cover interest payments with operating income.
Although the ratio has improved marginally in the following years, with values of -53.38 in 2021, -27.47 in 2022, and -27.79 in 2023, it still remains at negative levels, suggesting ongoing challenges in meeting interest obligations.
The latest available data as of June 30, 2024, shows an interest coverage ratio of -33.25, which reflects a continued struggle to generate sufficient operating income to cover interest expenses. This persistent negative trend in the interest coverage ratio raises concerns about News Corp A's financial health and its ability to service its debt obligations in the long term.
Peer comparison
Jun 30, 2024