RPC Inc (RES)
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 | 112,078 | 256,584 | 290,246 | 18,377 | -309,058 |
| Interest expense | US$ in thousands | 724 | 341 | 614 | 1,929 | 373 |
| Interest coverage | 154.80 | 752.45 | 472.71 | 9.53 | -828.57 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $112,078K ÷ $724K
= 154.80
RPC Inc's interest coverage ratio has shown significant fluctuations over the past five years.
As of December 31, 2020, the interest coverage ratio was at a concerning level of -828.57, indicating that the company's earnings were not sufficient to cover its interest expenses, posing a high risk of financial distress.
However, there has been a notable improvement in the interest coverage ratio in the subsequent years. By December 31, 2021, the ratio had increased to 9.53, reflecting a more favorable position where the company's earnings were more than sufficient to cover its interest payments.
The trend continued to be positive in the following years, with the interest coverage ratios increasing to 472.71 by December 31, 2022, 752.45 by December 31, 2023, and 154.80 by December 31, 2024. These figures indicate a strengthening financial position for RPC Inc, with ample earnings to comfortably meet its interest obligations.
Overall, the trend in RPC Inc's interest coverage ratio over the past five years shows a significant improvement from a precarious position to a more stable and favorable financial position, suggesting better capacity to service its debt obligations.
Peer comparison
Dec 31, 2024