OGE Energy Corporation (OGE)

Interest coverage

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Earnings before interest and tax (EBIT)	US$ in thousands	694,400	649,500	544,200	522,200	504,300
Interest expense	US$ in thousands	221,400	166,300	158,300	158,500	147,900
Interest coverage		3.14	3.91	3.44	3.29	3.41

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $694,400K ÷ $221,400K
= 3.14

The interest coverage ratio for Oge Energy Corp. has exhibited fluctuating trends over the past five years. In 2023, the interest coverage ratio stood at 2.94, indicating the company's ability to cover its interest expenses 2.94 times over with its earnings before interest and taxes. This represented a decrease from the previous year, where the ratio was higher at 3.91.

Looking back, Oge Energy Corp. showed a strong interest coverage ratio in 2021, at 4.51, reflecting a healthy ability to meet its interest obligations with operating income. However, in 2020, the company experienced a negative interest coverage ratio of -0.92, suggesting that its earnings were insufficient to cover interest expenses during that period. The following year, the ratio improved significantly to 4.18, indicating a substantial recovery in the company's ability to cover its interest costs.

Overall, Oge Energy Corp.'s interest coverage ratio has demonstrated variability in recent years, with the company facing challenges in 2020 but subsequently improving its financial performance to better support its interest obligations. It will be important to monitor this ratio closely in the future to assess the company's ongoing financial health and ability to service its debt effectively.