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Income Cover and Earnings Cover

income cover is the same as the interest cover ratio= EBIT/interest on debt

I don't know what earnings cover is. Probably it's the same as debt capital cover ratio.
 
Have seen earnings cover being used in two ways:

1) similar but wider concept to income cover - where the ratio of earnings to some form of outgo is calculated, one specific form is income cover where earnings (before interest and tax) are compared to interest payments. You can calculate the ratio of earnings relative to say required outgo on a project, investment etc, i.e. does your earnings cover your required outgo (whatever that would be).

2) "loss of earnings" cover - an insurance policy that replaces earnings in the case of some adverse event. It can be used in relation to corporate insurance where a company takes out an insurance policy to protect its earnings in the case of key staff members leaving / dying, or pretty much anything that causes the company to lose earnings. This is probably less relevant in the context of ST5.
 
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