Aramark (Aramark) Interest Coverage : 1.46 (As of Dec. 2023)

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What is Aramark Interest Coverage?

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 by its Interest Expense. Aramark's Operating Income for the three months ended in Dec. 2023 was $167 Mil. Aramark's Interest Expense for the three months ended in Dec. 2023 was $-115 Mil. Aramark's interest coverage for the quarter that ended in Dec. 2023 was 1.46. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Aramark's Interest Coverage or its related term are showing as below:

ARMK' s Interest Coverage Range Over the Past 10 Years
Min: 0.46 Med: 2.08 Max: 2.8
Current: 1.83

ARMK's Interest Coverage is ranked worse than
89.99% of 789 companies
in the Business Services industry
Industry Median: 13.39 vs ARMK: 1.83

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Aramark Interest Coverage Historical Data

The historical data trend for Aramark's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

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Aramark Interest Coverage Chart

Aramark Annual Data

Trend

Sep14

Sep15

Sep16

Sep17

Sep18

Sep19

Sep20

Sep21

Sep22

Sep23

Interest Coverage

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2.08

0.46

1.65

1.96

Aramark Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Interest Coverage	Get a 7-Day Free Trial															1.50	1.60	1.80	2.46	1.46

Competitive Comparison of Aramark's Interest Coverage

For the Specialty Business Services subindustry, Aramark's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Aramark's Interest Coverage Distribution in the Business Services Industry

For the Business Services industry and Industrials sector, Aramark's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Aramark's Interest Coverage falls into.

Aramark Interest Coverage Calculation

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

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Aramark's Interest Coverage for the fiscal year that ended in Sep. 2023 is calculated as

Here, for the fiscal year that ended in Sep. 2023, Aramark's Interest Expense was $-441 Mil. Its Operating Income was $863 Mil. And its Long-Term Debt & Capital Lease Obligation was $6,959 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Sep. 2023 )	/	Interest Expense (A: Sep. 2023 )
	=	-1	*	862.926	/	-441.262
	=	1.96

Aramark's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the three months ended in Dec. 2023, Aramark's Interest Expense was $-115 Mil. Its Operating Income was $167 Mil. And its Long-Term Debt & Capital Lease Obligation was $6,175 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Dec. 2023 )	/	Interest Expense (Q: Dec. 2023 )
	=	-1	*	166.95	/	-114.562
	=	1.46

The higher the ratio, the stronger the company's Financial Strength is.

Aramark (NYSE:ARMK) Interest Coverage 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 .

Aramark Interest Coverage Related Terms

Thank you for viewing the detailed overview of Aramark's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

Aramark (Aramark) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Business Services » Aramark (NYSE:ARMK) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

0AK:Germany 0AK:Germany

Address

2400 Market Street, Philadelphia, PA, USA, 19103

Website

https://www.aramark.com

Aramark provides food, facilities, and uniform services to a variety of clients and institutions. The majority of company revenue comes from its North American food and support services segment. Smaller but substantial segments include food and support services international, food and support services united states and uniform and career apparel. The food and support services segments provide food for school districts; colleges; healthcare facilities; correctional institutions; and business, sports, and entertainment venues. The uniform segment rents, delivers, cleans, and maintains work clothes and ancillary items like towels and mats to customers in North America and Japan. The company has hundreds of service locations and distribution centers across the United States and Canada.

Executives

Lauren A Harrington	officer: SVP and General Counsel	ARAMARK, 2400 MARKET STREET, PHILADELPHIA PA 19103
Marc A Bruno	officer: COO, U.S. Food & Facilities	C/O UNITED RENTALS, INC., 100 FIRST STAMFORD PLACE, SUITE 700, STAMFORD CT 06902
Kevin Wills	director	750 LAKESHORE PARKWAY, BIRMINGHAM AL 35211
Abigail Charpentier	officer: SVP & Chief HR Officer	2400 MARKET STREET, PHIADELPHIA PA 19103
Lynn Mckee	officer: See Remarks
Patricia E Lopez	director	333 LUDLOW ST, STAMFORD CT 06902
Kenneth M Keverian	director	IBM CORPORATION, ONE NEW ORCHARD ROAD, ARMONK NY 10504
Christopher T. Schilling	officer: SVP, Controller and CAO	2400 MARKET STREET, PHILADELPHIA PA 19103
Bridgette P Heller	director	TECH DATA CORPORATION, 5350 TECH DATA DRIVE, CLEARWATER FL 33760
Keith Bethel	officer: Chief Growth Officer	C/O ARAMARK, 2400 MARKET STREET, PHILADELPHIA PA 19103
Thomas Gerard Ondrof	officer: Executive VP and CFO	C/O PERFORMANCE FOOD GROUP COMPANY, 12500 WEST CREEK PARKWAY, RICHMOND VA 23238
Stephen I Sadove	director
Karen Marie King	director	C/O ARAMARK, 2400 MARKET STREET, PHILADELPHIA PA 19103
Greg Creed	director	1441 GARDINER LANE, LOUISVILLE KY 40213
Mantle Ridge Lp	other: Director by deputization	712 FIFTH AVENUE, SUITE 17F, NEW YORK NY 10019