Pilgrims Pride Corp (PPC)
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 | 1,572,660 | 566,751 | 1,177,540 | 237,914 | 287,630 |
| Interest expense | US$ in thousands | 161,175 | 202,272 | 152,672 | 145,792 | 126,118 |
| Interest coverage | 9.76 | 2.80 | 7.71 | 1.63 | 2.28 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $1,572,660K ÷ $161,175K
= 9.76
The interest coverage ratio for Pilgrims Pride Corp has fluctuated over the years:
- As of December 31, 2020, the interest coverage ratio was 2.28, indicating that the company earned 2.28 times the amount needed to cover its interest expenses.
- By December 31, 2021, the interest coverage ratio had decreased to 1.63, suggesting a decline in the company's ability to cover its interest obligations with its earnings.
- However, there was a significant improvement in the interest coverage ratio by December 31, 2022, reaching 7.71. This indicates a substantial increase in the company's ability to cover its interest payments with its operating income.
- The ratio decreased to 2.80 by December 31, 2023, possibly indicating a slight weakening in the company's ability to meet its interest obligations comfortably.
- Finally, by December 31, 2024, the interest coverage ratio surged to 9.76, reflecting a strong improvement in the company's ability to cover its interest expenses with its operating income.
Overall, the trend in Pilgrims Pride Corp's interest coverage ratio shows some fluctuations but demonstrates a potential pattern of improvement in managing its interest obligations over the years. It is essential for investors and stakeholders to monitor this ratio to assess the company's financial health and risk management capabilities.
Peer comparison
Dec 31, 2024