Range Resources Corp (RRC)

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	369,363	1,224,350	1,579,020	629,414	-544,662
Interest expense	US$ in thousands	118,758	124,004	165,145	227,336	192,667
Interest coverage		3.11	9.87	9.56	2.77	-2.83

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $369,363K ÷ $118,758K
= 3.11

Range Resources Corp's interest coverage ratio has shown significant variability over the past five years based on the provided data.

As of December 31, 2020, the interest coverage ratio was negative at -2.83, indicating that the company's operating income was insufficient to cover its interest expenses. This may raise concerns about the company's ability to meet its debt obligations through its current earnings.

However, there was a notable improvement in the interest coverage ratio by December 31, 2021, when it increased to 2.77. This suggests that the company's operating income became more sufficient to cover its interest expenses.

The trend continued positively in the following years, with the interest coverage ratio rising to 9.56 by December 31, 2022, and further increasing to 9.87 by December 31, 2023. These higher ratios indicate that Range Resources Corp had ample earnings to comfortably cover its interest payments during these periods.

However, the interest coverage ratio decreased to 3.11 by December 31, 2024, showing a decline from the previous years. While still above 1, indicating the company can cover its interest expenses with operating income, the decrease from the previous years should be closely monitored for any potential financial strain.

In conclusion, Range Resources Corp's interest coverage ratio has exhibited variability, with improvements in recent years but a slight decline in the most recent period. This metric is crucial for evaluating the company's ability to meet its interest obligations and manage its debt burden.