Fixed-Charge Coverage

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Fixed-Charge Coverage Ratio

A measure of a company's ability to pay its fixed expenses, such as rent and interest, on debt without resorting to more debt. A ratio over 1 indicates that the company is able to pay its fixed charges, while a ratio below one indicates the opposite. The fixed charge coverage ratio is calculated thus:

Fixed-charge coverage ratio = (EBIT + fixed charges before tax) / (fixed charged before tax + interest)

fixed-charge coverage

The number of times that a firm's operating income exceeds its fixed payments. Fixed-charge coverage is a measure of a firm's ability to meet contractually fixed payments, with high coverage indicating significant flexibility for making payments in the event that business conditions deteriorate and earnings decline. Expenses used in calculating fixed-charge coverage usually include interest, lease payments, preferred dividends, and principal payments on debt. Also called times fixed charges. Compare interest coverage.

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Ability to Pay Coverage Coverage Ratio Coverage Ratios Debt Management Ratio Fixed-Charge Coverage Ratio Interest Coverage Times Fixed Charges Times Interest Earned			9x fixed-charge coverage ratio (defined as recurring EBITDA less Fitch's estimate of capital expenditures and straight-line rents, divided by interest expense and capitalized interest) for the 12 months ended March 31, 2009. Fitch Affirms Healthcare Realty Trust's IDR at 'BBB'; Outlook Negative by Business Wire When revising the rating Outlook on First Industrial to Negative from Stable in December 2008, Fitch cited First Industrial's recurring EBITDA fixed-charge coverage ratio (defined as recurring EBITDA excluding joint venture impairments less capital expenditures and straight-line rents divided by interest expense, capitalized interest and preferred dividends) as a major rating factor. Fitch Downgrades First Industrial's IDR to 'BB-'; Outlook Negative by Business Wire In addition, the company's recurring fixed-charge coverage metrics have shown the company becoming increasingly reliant on transactional sources of income. Fitch Rates First Industrial's Bonds & Pfd Stock 'BBB' & 'BBB-' by Business Wire			Fixed base index Fixed Benefits fixed bid Fixed Capital Formation Fixed Cost Fixed Coupon Fixed Currency Fixed dates Fixed Exchange Rate fixed expenses Fixed for Floating Swap Fixed Income Fixed Income Clearing Corporation Fixed Income Equivalent Fixed Income Instruments Fixed Income Market Fixed Interest Rate fixed lease Fixed Premium Fixed Price Fixed Price Basis Fixed Rate Fixed Rate Loan Fixed Term Lease Fixed Trust Fixed-Charge Coverage Fixed-Charge Coverage Ratio Fixed-dollar obligations Fixed-Dollar Security Fixed-Income Arbitrage Fixed-Income Investment Fixed-Income Securities Fixed-Income Security Fixed-price tender offer Fixed-Rate Capital Security fixed-rate loan fixed-rate mortgage Fixed-Rate Payer fixed-term mortgage Fixed-term reverse mortgage fixer-upper fixture fixturing period FJ FJD FK FKP Flag flag lot Flake Flash			Fixed Wireless Network Fixed Wireless Phone Fixed Wireless Point-to-Multipoint Access Fixed Wireless Services Fixed Wireless System Fixed Wireless Telephone Fixed Word Format fixed word length Fixed wrestling Fixed Your Post Fixed, Determinable, Annual, Periodical Fixed, Scientific, Engineering fixed-active tooling fixed-bar grille fixed-base index Fixed-base Precision Approach Radar Fixed-Base Simulator Fixed-Based Operator Fixed-Bed Catalytic Reactor fixed-bed hydroforming fixed-bed operation fixed-bias transistor circuit fixed-block Fixed-Charge Conversion Ratio Fixed-Charge Coverage Fixed-charge coverage ratio Fixed-Charge Coverage Ratios fixed-charge problem Fixed-Charge-Coverage Fixed-Charge-Coverage Ratio Fixed-Charge-Coverage Ratios fixed-combination drug fixed-combination drug Fixed-Conductance Heat Pipe fixed-cost contract fixed-cycle operation fixed-cycle operation Fixed-Database Lempel-Ziv Fixed-Decade Capacitor Fixed-Delay Tree Search Fixed-Delay Tree Search with Decision Feedback Fixed-Dollar Annuities Fixed-Dollar Annuities Fixed-Dollar Annuity Fixed-Dollar Annuity Fixed-dollar obligations Fixed-Dollar Securities Fixed-dollar security fixed-dose combination fixed-dose combination drugs Fixed-Dose-Combination Fixed-Effects Vector Decomposition fixed-electrode method

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