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RR Donnelley & Sons Co (NAS:RRD)
Interest Coverage
0.00 (As of Jun. 2014)

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company’s Operating Income (EBIT) by its Interest Expense. RR Donnelley & Sons Co's Operating Income for the three months ended in Jun. 2014 was $178 Mil. RR Donnelley & Sons Co's Interest Expense for the three months ended in Jun. 2014 was $0 Mil. RR Donnelley & Sons Co's interest coverage for the quarter that ended in Jun. 2014 was 0.00. The higher the ratio, the stronger the company’s financial strength is.

RRD' s 10-Year Interest Coverage Range
Min: 0.25   Max: 6.41
Current: 2.12

0.25
6.41

During the past 13 years, the highest interest coverage of RR Donnelley & Sons Co was 6.41. The lowest was 0.25. And the median was 4.74.

RRD's Interest Coverageis ranked lower than
63% of the 704 Companies
in the Global Business Services industry.

( Industry Median: 20.25 vs. RRD: 2.12 )

Definition

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company’s Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage=-1*Operating Income/Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

RR Donnelley & Sons Co did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt is 0, or Interest Expense is positive, then

RR Donnelley & Sons Co had no debt.

RR Donnelley & Sons Co's Interest Coverage for the fiscal year that ended in Dec. 2013 is calculated as

Here, for the fiscal year that ended in Dec. 2013, RR Donnelley & Sons Co's Interest Expense was $-273 Mil. Its Operating Income was $580 Mil. And its Long-Term Debt was $3,587 Mil.

Interest Coverage=-1*Operating Income (A: Dec. 2013 )/Interest Expense (A: Dec. 2013 )
=-1*579.7/-272.9
=2.12

RR Donnelley & Sons Co's Interest Coverage for the quarter that ended in Jun. 2014 is calculated as

Here, for the three months ended in Jun. 2014, RR Donnelley & Sons Co's Interest Expense was $0 Mil. Its Operating Income was $178 Mil. And its Long-Term Debt was $3,429 Mil.

RR Donnelley & Sons Co had no debt.

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

The higher the ratio, the stronger the company’s financial strength is.


Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company’s overage financial strength.


Related Terms

Operating Income, Interest Expense, Financial Strength


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

RR Donnelley & Sons Co Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
interest_coverage 5.354.076.411.32At Loss1.412.400.25At Loss2.12

RR Donnelley & Sons Co Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
interest_coverage 2.002.58At LossAt LossAt Loss2.64At LossAt LossAt LossAt Loss
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