Interest coverage indicates how many times the interest could be paid from available earnings, thereby providing a sense of the safety margin a company has for paying its interest for any period. A company that sustains earnings well above its interest requirements is in an excellent position to weather possible financial storms. By contrast, a company that barely manages to cover its interest costs may easily fall into bankruptcy if its earnings suffer for even a single month. This is especially true for cyclical industry!
Formula(Above)
Ezra's interest converage after deducting for one off items is a mere 5.06% and Jaya's is 52.5%. No wonder Jaya can still give off dividends and Ezra has not declared any dividends. Even if we give Ezra a chance, and don't deduct their one off items, its coverage is only 26.1%, half of Jaya's! Tsk Tsk Tsk. No wonder you are in the top volume for 2 days consecutively.
And hello...dear readers..look at how these 2 companies are still so optimistic about the oil and gas industry. Do they watch CNBC or have they been living in a cave? As usual the management talk!