Sysco Corporation (SYY)
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 | — | 3,175,000 | 2,812,000 | 2,371,000 | 1,464,860 |
| Interest expense | US$ in thousands | 635,000 | 607,000 | 527,000 | 624,000 | 880,137 |
| Interest coverage | 0.00 | 5.23 | 5.34 | 3.80 | 1.66 |
June 30, 2025 calculation
Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $635,000K
= 0.00
The interest coverage ratio for Sysco Corporation has demonstrated significant variation over the analyzed period. As of June 30, 2021, the ratio stood at 1.66, indicating a relatively low capacity to cover interest expenses from earnings before interest and taxes (EBIT), and suggesting potential financial stress or high leverage at that time. By June 30, 2022, the ratio markedly improved to 3.80, reflecting a substantial enhancement in the company's ability to meet its interest obligations, attributable to improved earnings or a reduction in interest expense.
The upward trend continued through June 30, 2023, with the ratio reaching 5.34, indicating a robust capacity to cover interest expenses and suggesting that the company's earnings significantly exceeded its interest obligations during this period. This increased buffer points to a period of stronger operational performance and financial stability.
However, by June 30, 2024, the ratio saw a slight decline to 5.23, nonetheless remaining at a considerably healthy level, which indicates sustained ability to service interest costs effectively. Contrastingly, as of June 30, 2025, the interest coverage ratio drops to zero, which indicates that the company either reported no earnings before interest and taxes (EBIT) or possibly faced a suspension or loss, rendering it incapable of covering interest expenses through its operational earnings. This dramatic change suggests severe financial distress or extraordinary circumstances affecting the company's profitability and interest coverage capacity at that time.
In summary, the interest coverage ratio for Sysco exhibited a strong upward trajectory from 2021 through 2023, reflecting improving financial health and operational earnings. Nonetheless, a sharp decline to zero in 2025 signifies a critical deterioration in the company's ability to meet its interest obligations, warranting further investigation into underlying causes such as operational losses, extraordinary charges, or restructuring activities.
Peer comparison
Jun 30, 2025