Xerox Corp (XRX)
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 | 170,000 | -126,000 | -265,000 | 471,000 | 1,768,000 |
| Interest expense | US$ in thousands | 198,000 | 199,000 | 207,000 | 215,000 | 236,000 |
| Interest coverage | 0.86 | -0.63 | -1.28 | 2.19 | 7.49 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $170,000K ÷ $198,000K
= 0.86
The interest coverage ratio for Xerox Holdings Corp has fluctuated over the past five years, as indicated in the table below:
- Dec 31, 2019: 12.98
- Dec 31, 2020: 5.15
- Dec 31, 2021: 3.51
- Dec 31, 2022: 2.69
- Dec 31, 2023: 6.65
The interest coverage ratio measures the company's ability to meet its interest obligations on its debt with its operating income. A higher interest coverage ratio indicates that the company is more capable of servicing its debt.
Xerox Holdings Corp experienced a significant decrease in its interest coverage ratio from 2019 to 2022, indicating potential challenges in meeting its interest obligations with its operating income during those years. However, there has been a notable improvement in the ratio in 2023, suggesting a better position in terms of being able to cover interest expenses with operating income.
It is important for investors and creditors to monitor Xerox Holdings Corp's interest coverage ratio in the future to assess the company's financial health and its ability to manage its debt effectively.
Peer comparison
Dec 31, 2023