PG&E Corp (PCG)

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 4,459,000 2,671,000 1,837,000 1,883,000 1,755,000
Interest expense US$ in thousands 3,051,000 2,850,000 1,917,000 1,601,000 1,260,000
Interest coverage 1.46 0.94 0.96 1.18 1.39

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $4,459,000K ÷ $3,051,000K
= 1.46

The interest coverage ratio for PG&E Corp has shown a declining trend over the last five years, starting at 1.39 in December 2020 and dropping to 0.94 by December 2023, before slightly recovering to 1.46 by December 2024. This downward trend indicates that the company's ability to cover its interest expenses with its operating income has weakened, potentially signaling increasing financial risk. It is important for PG&E Corp to closely monitor its interest coverage ratio to ensure it remains at a healthy level to meet its debt obligations and maintain financial stability.