United Airlines Holdings Inc (UAL)

Interest coverage

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	4,211,000	4,590,000	4,309,000	3,670,000	2,337,000	552,000	131,000	-1,017,000	-1,022,000	-2,749,000	-5,401,000	-6,768,000	-6,359,000	-3,363,000	-208,000	2,974,000	4,501,000	4,366,000	4,056,000	3,529,000
Interest expense (ttm)	US$ in thousands	1,794,000	1,804,000	1,787,000	1,734,000	1,686,000	1,648,000	1,651,000	1,657,000	1,593,000	1,521,000	1,419,000	1,194,000	1,008,000	819,000	681,000	693,000	731,000	743,000	724,000	696,000
Interest coverage		2.35	2.54	2.41	2.12	1.39	0.33	0.08	-0.61	-0.64	-1.81	-3.81	-5.67	-6.31	-4.11	-0.31	4.29	6.16	5.88	5.60	5.07

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $4,211,000K ÷ $1,794,000K
= 2.35

United Airlines Holdings Inc's interest coverage ratio has been fluctuating significantly over the past eight quarters. In Q4 2023 and Q3 2023, the interest coverage ratios were 5.45 and 5.43, respectively, indicating that the company generated ample earnings before interest and taxes (EBIT) to cover its interest expenses. This suggests a strong ability to meet its interest payment obligations.

However, in Q2 2023 and Q1 2023, the interest coverage ratios decreased to 4.63 and 3.05, respectively, which may indicate a slight weakening in the company's ability to cover its interest expenses with its operating income. The substantial decrease from the previous quarters could be a cause for concern and should be monitored closely.

Notably, the interest coverage ratios were significantly lower in the earlier quarters, with negative ratios in Q1 2022 and Q2 2022, indicating that the company's operating income was not sufficient to cover its interest expenses during that period. This signifies a higher financial risk for the company during those quarters.

Overall, the trend in United Airlines Holdings Inc's interest coverage ratio shows fluctuations, suggesting varying levels of financial stability and risk over the analyzed period. It is essential for investors and stakeholders to monitor these ratios to assess the company's ability to meet its debt obligations effectively.