Great-West Lifeco (TSX:GWO) Interest Coverage : 8.59 (As of Dec. 2023)

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What is Great-West Lifeco 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 EBIT by its Interest Expense. Great-West Lifeco's EBIT for the three months ended in Dec. 2023 was C$687 Mil. Great-West Lifeco's Interest Expense for the three months ended in Dec. 2023 was C$-80 Mil. Great-West Lifeco's interest coverage for the quarter that ended in Dec. 2023 was 8.59. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Great-West Lifeco's Interest Coverage or its related term are showing as below:

TSX:GWO' s Interest Coverage Range Over the Past 10 Years
Min: 8.48 Med: 12.15 Max: 18.05
Current: 8.49

TSX:GWO's Interest Coverage is ranked worse than
62.42% of 322 companies
in the Insurance industry
Industry Median: 13.355 vs TSX:GWO: 8.49

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

Great-West Lifeco Interest Coverage Historical Data

The historical data trend for Great-West Lifeco'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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Great-West Lifeco Interest Coverage Chart

Great-West Lifeco Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Interest Coverage

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11.00

11.63

12.58

11.72

8.48

Great-West Lifeco 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															4.59	6.51	7.43	11.61	8.59

Competitive Comparison of Great-West Lifeco's Interest Coverage

For the Insurance - Life subindustry, Great-West Lifeco'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.

Great-West Lifeco's Interest Coverage Distribution in the Insurance Industry

For the Insurance industry and Financial Services sector, Great-West Lifeco's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Great-West Lifeco's Interest Coverage falls into.

Great-West Lifeco 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 EBIT is positive, then

Interest Coverage

-1

EBIT

Interest Expense

Else if Interest Expense is negative and EBIT 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.

Great-West Lifeco's Interest Coverage for the fiscal year that ended in Dec. 2023 is calculated as

Here, for the fiscal year that ended in Dec. 2023, Great-West Lifeco's Interest Expense was C$-410 Mil. Its EBIT was C$3,478 Mil. And its Long-Term Debt & Capital Lease Obligation was C$9,215 Mil.

Interest Coverage	=	-1	*	EBIT (A: Dec. 2023 )	/	Interest Expense (A: Dec. 2023 )
	=	-1	*	3478	/	-410
	=	8.48

Great-West Lifeco's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the three months ended in Dec. 2023, Great-West Lifeco's Interest Expense was C$-80 Mil. Its EBIT was C$687 Mil. And its Long-Term Debt & Capital Lease Obligation was C$9,215 Mil.

Interest Coverage	=	-1	*	EBIT (Q: Dec. 2023 )	/	Interest Expense (Q: Dec. 2023 )
	=	-1	*	687	/	-80
	=	8.59

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

Great-West Lifeco (TSX:GWO) 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 .

Great-West Lifeco Interest Coverage Related Terms

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

Great-West Lifeco (TSX:GWO) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Insurance » Great-West Lifeco Inc (TSX:GWO) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

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Address

100 Osborne Street North, Winnipeg, MB, CAN, R3C 1V3

Website

https://www.greatwestlifeco.com

Great-West Lifeco provides life insurance, health insurance, retirement products, asset management, recordkeeping services, and reinsurance products in Canada, the United States, and Europe. The Canada business contributes approximately 35% of adjusted earnings and has leading market positions in group insurance, group retirement, and individual insurance. The company operates the second-largest recordkeeping business under the Empower brand in the United States, with an earnings contribution from the country approximating 20%. Great-West Lifeco also offers various products across Europe markets with a strong presence in the U.K., Ireland, and Germany. The Europe segment contributes around 28% of adjusted earnings and the reinsurance business accounts for around 17% of adjusted earnings.

Great-West Lifeco (TSX:GWO) Headlines

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