Owens Corning Inc (OC)
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 | 1,128,000 | 1,555,000 | 1,510,000 | 1,542,000 | 1,673,000 | 1,672,000 | 1,820,000 | 1,819,000 | 1,723,000 | 1,864,000 | 1,637,000 | 1,577,000 | 1,440,000 | 1,391,000 | 1,303,000 | 1,046,000 | -122,000 | -268,000 | -321,000 | -263,000 |
| Interest expense (ttm) | US$ in thousands | 212,000 | 165,000 | 112,000 | 71,000 | 76,000 | 89,000 | 100,000 | 103,000 | 109,000 | 111,000 | 114,000 | 121,000 | 126,000 | 131,000 | 135,000 | 138,000 | 132,000 | 128,000 | 126,000 | 122,000 |
| Interest coverage | 5.32 | 9.42 | 13.48 | 21.72 | 22.01 | 18.79 | 18.20 | 17.66 | 15.81 | 16.79 | 14.36 | 13.03 | 11.43 | 10.62 | 9.65 | 7.58 | -0.92 | -2.09 | -2.55 | -2.16 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,128,000K ÷ $212,000K
= 5.32
Owens Corning Inc's interest coverage ratio has shown significant fluctuations over the past few years. The company experienced a negative interest coverage ratio in the first half of 2020, indicating that its earnings were insufficient to cover its interest expenses during that period. However, the ratio improved markedly in the subsequent quarters, reaching double digits by the end of 2021.
The interest coverage ratio continued to strengthen through the first half of 2023, peaking at 22.01 by the end of December 2023. This indicates that the company's operating income was more than sufficient to cover its interest payments during this period. However, there was a notable decline in the interest coverage ratio in the first half of 2024, dropping to 13.48 by June 30, 2024, and further decreasing to 5.32 by the end of December 31, 2024.
Overall, Owens Corning Inc's interest coverage ratio has shown a mixed performance, with periods of strong coverage followed by declines. It is crucial for the company to closely monitor its interest coverage ratio to ensure it maintains a healthy financial position and can meet its debt obligations effectively.