Fixed-Charge Coverage Ratio Calculator
Calculate FCCR from a numerator and fixed charges that you define. FCCR definitions vary substantially between credit agreements — enter the components per your agreement.
Inputs
FCCR definitions vary substantially between agreements. Common fixed charges include interest and lease expense, but your agreement controls the actual definition. This calculator models the components you enter — it does not define them.
Methodology
- FCCR
- Numerator ÷ fixed charges, expressed as a multiple. The numerator and fixed charges are defined by your credit agreement.
- Why definitions vary
- Some agreements use EBITDA − capex as the numerator; others use EBITDA. Fixed charges may include interest, lease expense and sometimes principal. Refer to your finance documents.
- Headroom
- Actual FCCR − minimum threshold. Positive means FCCR is above the minimum.
Worked example
- Numerator: £1,200,000
- Fixed charges: £800,000
- FCCR = 1.50x (minimum 1.25x → headroom 0.25x)
Interpretation & limitations
A higher FCCR means more cushion above a minimum fixed-charge coverage test. Because definitions differ so widely, the ratio is only meaningful when the numerator and fixed charges match your agreement's definitions. This calculator does not construct an illustrative FCCR — it uses the components you enter directly.
Related tools
Your financial data stays on your device. Calculations run entirely in your browser. Nothing is uploaded or saved.
Understanding FCCR
The Fixed-Charge Coverage Ratio (FCCR) compares an agreed measure of earnings or cash generation with the fixed financial charges that must be serviced. It is intended to indicate the extent to which the defined numerator provides coverage of those recurring obligations.
A higher FCCR generally indicates greater coverage of the fixed charges included in the calculation. Where a finance agreement contains a minimum FCCR covenant, the calculated ratio can be compared with that threshold to assess the amount of covenant headroom available.
What affects FCCR?
FCCR can decline when the defined numerator falls or when the fixed charges included in the denominator increase. Depending on the credit agreement, relevant factors may include changes in EBITDA, capital expenditure, interest expense, lease or rental obligations, and scheduled debt payments.
There is no single universal FCCR definition. Both the numerator and the fixed charges included in the denominator can differ materially between agreements. The contractual definitions should therefore be used when assessing an actual covenant.