Ziff Davis Inc (ZD)
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 | 139,717 | 107,245 | 158,814 | 562,115 | 247,118 |
| Interest expense | US$ in thousands | 35,300 | 41,600 | 37,100 | 79,600 | 58,100 |
| Interest coverage | 3.96 | 2.58 | 4.28 | 7.06 | 4.25 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $139,717K ÷ $35,300K
= 3.96
The interest coverage ratio of Ziff Davis Inc improved from 4.25 in December 31, 2020, to 7.06 in December 31, 2021, indicating the company's ability to comfortably meet its interest obligations from its operating income. However, the ratio decreased to 4.28 in December 31, 2022, and further dropped to 2.58 in December 31, 2023, suggesting a potential increase in the financial risk associated with servicing its debt. Despite this drop, Ziff Davis Inc managed to improve its interest coverage ratio to 3.96 as of December 31, 2024. Overall, the company should continue to closely monitor its ability to cover interest expenses to ensure financial stability and sustainability.