Performance Food Group Co (PFGC)
Interest coverage
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | — | 829,000 | 762,000 | 350,000 | 207,100 |
| Interest expense | US$ in thousands | 358,400 | 232,200 | 218,000 | 182,900 | 152,400 |
| Interest coverage | 0.00 | 3.57 | 3.50 | 1.91 | 1.36 |
June 30, 2025 calculation
Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $358,400K
= 0.00
The interest coverage ratio of Performance Food Group Co demonstrates notable fluctuations over the specified period. As of June 30, 2021, the ratio stood at 1.36, indicating that the company's earnings before interest and taxes (EBIT) were only marginally sufficient to cover its interest obligations, which suggests a relatively narrow safety margin and potential financial risk if earnings decline.
By June 30, 2022, the ratio experienced a significant improvement to 1.91, nearly doubling from the previous year, thereby indicating increased earnings capable of covering interest expenses more comfortably. This improvement suggests an enhancement in operating performance and capacity to service debt.
The trend continued positively through June 30, 2023, with the ratio further increasing to 3.50. This indicates a substantial and healthy level of interest coverage, with EBIT clearly exceeding interest costs by a significant margin, reflecting strong operational performance and improved financial stability.
As of June 30, 2024, the ratio marginally increased to 3.57, suggesting continued stability and consistency in earnings relative to interest obligations. The elevated ratio values during this period emphasize a robust capacity to meet interest payments, which can enhance the company's creditworthiness and investor confidence.
However, the data for June 30, 2025, shows a ratio of 0.00. This stark decline indicates that the company either anticipates negligible earnings before interest and taxes relative to its interest expenses or has potentially faced extraordinary circumstances adversely affecting profitability. A ratio of zero typically implies that the company may have reported no earnings or losses that do not cover interest obligations, raising concerns about financial distress or restructuring needs.
In summary, the trend from 2021 through 2024 reflects a period of improving interest coverage, culminating in a strong safety margin. Nonetheless, the projected or reported zero interest coverage in 2025 raises critical questions regarding the company's future profitability and its ability to service debt, warranting close monitoring of subsequent financial developments.
Peer comparison
Jun 30, 2025