Occidental Petroleum Corporation (OXY)
Interest coverage
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 5,245,000 | 7,374,000 | 15,063,000 | 5,319,000 | -14,281,000 |
| Interest expense | US$ in thousands | 1,175,000 | 945,000 | 1,030,000 | 1,614,000 | 1,424,000 |
| Interest coverage | 4.46 | 7.80 | 14.62 | 3.30 | -10.03 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $5,245,000K ÷ $1,175,000K
= 4.46
Interest coverage ratio measures the extent to which a company can cover its interest expenses with its operating income.
In December 2020, Occidental Petroleum Corporation had an interest coverage ratio of -10.03, indicating that its operating income was insufficient to cover its interest expenses, potentially signaling financial distress.
However, by December 2021, the interest coverage ratio improved significantly to 3.30, showing a better ability to pay interest obligations from operating income.
The ratio continued to improve in December 2022, reaching 14.62, reflecting a strong ability to cover interest expenses.
In December 2023, the interest coverage ratio decreased to 7.80, but still remained at a reasonable level, indicating the company's capacity to meet interest payments.
By December 2024, the interest coverage ratio further declined to 4.46, suggesting a slight decrease in the company's ability to cover interest costs compared to the previous year.
Overall, the trend in Occidental Petroleum Corporation's interest coverage ratio shows fluctuations but generally indicates an improvement in the company's ability to handle interest expenses, with some variations in performance over the years.
Peer comparison
Dec 31, 2024