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Norwegian Cruise Line Holdings (NYSE:NCLH) Interest Coverage

: 2.89 (As of Sep. 2023)
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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. Norwegian Cruise Line Holdings's Operating Income for the three months ended in Sep. 2023 was $523 Mil. Norwegian Cruise Line Holdings's Interest Expense for the three months ended in Sep. 2023 was $-181 Mil. Norwegian Cruise Line Holdings's interest coverage for the quarter that ended in Sep. 2023 was 2.89. The higher the ratio, the stronger the company's financial strength is.

Warning Sign:

Ben Graham prefers companies' interest coverage to be at least 5. Norwegian Cruise Line Holdings Ltds earnings cannot cover its interest expense. If the situation continues, the company may have to issue more debt.

The historical rank and industry rank for Norwegian Cruise Line Holdings's Interest Coverage or its related term are showing as below:

NCLH' s Interest Coverage Range Over the Past 10 Years
Min: 0.74   Med: 3.34   Max: 4.51
Current: 0.74


NCLH's Interest Coverage is ranked worse than
88.83% of 600 companies
in the Travel & Leisure industry
Industry Median: 5.015 vs NCLH: 0.74

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


Norwegian Cruise Line Holdings Interest Coverage Historical Data

The historical data trend for Norwegian Cruise Line Holdings'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.

* Premium members only.

Norwegian Cruise Line Holdings Annual Data
Trend Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22
Interest Coverage
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 4.51 4.32 - - -

Norwegian Cruise Line Holdings Quarterly Data
Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23
Interest Coverage Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only - - 0.06 1.53 2.89

Competitive Comparison

For the Travel Services subindustry, Norwegian Cruise Line Holdings'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.


Norwegian Cruise Line Holdings Interest Coverage Distribution

For the Travel & Leisure industry and Consumer Cyclical sector, Norwegian Cruise Line Holdings's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Norwegian Cruise Line Holdings's Interest Coverage falls into.



Norwegian Cruise Line Holdings 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.

Norwegian Cruise Line Holdings's Interest Coverage for the fiscal year that ended in Dec. 2022 is calculated as

Here, for the fiscal year that ended in Dec. 2022, Norwegian Cruise Line Holdings's Interest Expense was $-802 Mil. Its Operating Income was $-1,552 Mil. And its Long-Term Debt & Capital Lease Obligation was $12,630 Mil.

Norwegian Cruise Line Holdings did not have earnings to cover the interest expense.

Norwegian Cruise Line Holdings's Interest Coverage for the quarter that ended in Sep. 2023 is calculated as

Here, for the three months ended in Sep. 2023, Norwegian Cruise Line Holdings's Interest Expense was $-181 Mil. Its Operating Income was $523 Mil. And its Long-Term Debt & Capital Lease Obligation was $12,635 Mil.

Interest Coverage=-1* Operating Income (Q: Sep. 2023 )/Interest Expense (Q: Sep. 2023 )
=-1*523.318/-181.201
=2.89

* 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.

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


Norwegian Cruise Line Holdings  (NYSE:NCLH) 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 .


Norwegian Cruise Line Holdings Interest Coverage Related Terms

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


Norwegian Cruise Line Holdings (NYSE:NCLH) Business Description

Address
7665 Corporate Center Drive, Miami, FL, USA, 33126
Norwegian Cruise Line is the world's third-largest cruise company by berths (at more than 66,000), operating 31 ships across three brands (Norwegian, Oceania, and Regent Seven Seas), offering both freestyle and luxury cruising. The company had redeployed its entire fleet as of May 2022. With six passenger vessels on order among its brands through 2028 (representing 16,500 incremental berths), Norwegian is increasing capacity faster than its peers, expanding its brand globally. Norwegian sails to around 700 global destinations.
Executives
Jose E. Cil director 5505 BLUE LAGOON DRIVE, MIAMI FL 33126
Daniel S Farkas officer: EVP Gen. Counsel & Asst. Sec'y 5840 SW 117TH STREET, CORAL GABLES FL 33156
Faye L. Ashby officer: SVP & Chief Accounting Officer 7665 CORPORATE CENTER DRIVE, MIAMI FL 33126
Patrik Dahlgren officer: EVP, Vessel Operations 7665 CORPORATE CENTER DRIVE, MIAMI FL 33126
Del Rio Frank J director, officer: Pres. & CEO 8300 NW 33RD STREET, SUITE 100, MIAMI FL 33122
Mark Kempa officer: EVP & CFO 7665 CORPORATE CENTER DRIVE, MIAMI FL 33126
David Herrera officer: Pres. NCL 7665 CORPORATE CENTER DRIVE, MIAMI FL 33126
Del Rio Frank A. officer: Pres. Oceania Cruises C/O NEW BEGINNINGS ACQUISITION CORP., 800 1ST STREET, UNIT 1, MIAMI FL 33139
Andrea Demarco officer: Pres. RSSC 7665 CORPORATE CENTER DRIVE, MIAMI FL 33126
Jason Montague officer: Pres. & CEO of RSSC C/O PRESTIGE CRUISES INTERNATIONAL, INC., 8300 NW 33RD STREET, SUITE 100, MIAMI FL 33122
Zillah Byng-thorne director 7665 CORPORATE CENTER DRIVE, MIAMI FL 33126
Howard J Sherman officer: Pres. & CEO Oceania Cruises 7665 CORPORATE CENTER DRIVE, MIAMI FL 33126
Russell W Galbut director 7665 CORPORATE DRIVE, MIAMI FL 33126
Harry C Curtis director C/O NORWEGIAN CRUISE LINE HOLDINGS, 7300 CORPORATE CENTER DRIVE, MIAMI FL 33126
Robert Binder officer: Vice Chair, Pres. & CEO OCI 7665 CORPORATE CENTER DRIVE, MIAMI FL 33126