PG&E Corp (PCG)

Interest coverage

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	2,671,000	1,666,000	1,991,000	1,930,000	1,837,000	2,348,000	2,058,000	2,379,000	2,276,000	2,055,000	1,987,000	-9,000	150,000	-4,613,000	-7,281,000	-9,691,000	-10,128,000	-15,315,000	-12,319,000	-10,144,000
Interest expense (ttm)	US$ in thousands	2,850,000	2,486,000	2,329,000	2,100,000	1,917,000	1,751,000	1,625,000	1,612,000	1,601,000	1,621,000	1,613,000	1,414,000	1,260,000	1,563,000	1,224,000	1,085,000	934,000	466,000	646,000	812,000
Interest coverage		0.94	0.67	0.85	0.92	0.96	1.34	1.27	1.48	1.42	1.27	1.23	-0.01	0.12	-2.95	-5.95	-8.93	-10.84	-32.86	-19.07	-12.49

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,671,000K ÷ $2,850,000K
= 0.94

Interest coverage is a key financial ratio that indicates a company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio suggests that the company is more capable of meeting its interest payments and is considered a positive indicator of financial health.

In the case of PG&E Corp., the interest coverage ratio has shown a fluctuating trend over the past eight quarters. In Q4 2023, the interest coverage ratio improved to 1.78 from 1.61 in the previous quarter, indicating that the company's operating income was sufficient to cover its interest expenses by 1.78 times. This suggests a positive development in PG&E Corp.'s ability to meet its interest obligations.

While the company's interest coverage ratio has varied over the quarters, it has generally remained above 1, indicating that PG&E Corp. has generated enough operating income to cover its interest expenses. However, the ratios have not shown a consistent upward or downward trend, suggesting some volatility in the company's ability to cover its interest payments.

Overall, PG&E Corp.'s interest coverage ratio provides insight into how effectively the company is managing its interest obligations in relation to its operating income. Investors and stakeholders may monitor this ratio closely to assess the company's financial stability and ability to service its debt.