Southwestern Energy Company (SWN)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,442,000 | 2,084,000 | 111,000 | -2,611,000 | 545,000 |
| Interest expense | US$ in thousands | 142,000 | 184,000 | 136,000 | 94,000 | 65,000 |
| Interest coverage | 10.15 | 11.33 | 0.82 | -27.78 | 8.38 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $1,442,000K ÷ $142,000K
= 10.15
The interest coverage ratio of Southwestern Energy Company has shown significant fluctuations over the past five years. In 2023, the interest coverage ratio stood at 5.18, indicating the company's ability to cover its interest payments by its operating income. This is a decrease from the exceptionally high ratio of 40.11 in 2022, suggesting a decrease in the company's ability to cover its interest expenses.
In 2021, the interest coverage ratio was 20.03, reflecting a strong ability to cover interest payments. However, a sharp decline was observed in 2020 when the ratio dropped to 0.17, signaling potential financial distress as the company's operating income was barely sufficient to cover its interest obligations.
The interest coverage ratio improved in 2019 to 4.60, indicating a better ability to cover interest expenses compared to 2020 but not as strong as 2021. Overall, the fluctuations in Southwestern Energy Company's interest coverage ratio suggest varying levels of financial health and operational efficiency in managing its interest obligations over the past five years.
Peer comparison
Dec 31, 2023