Archer-Daniels-Midland Company (ADM)
Return on total capital
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 4,958,000 | 5,378,000 | 5,516,000 | 5,793,000 | 5,604,000 | 5,335,000 | 4,721,000 | 3,998,000 | 3,552,000 | 3,298,000 | 2,890,000 | 2,661,000 | 2,212,000 | 1,989,000 | 2,289,000 | 2,033,000 | 1,990,000 | 1,801,000 | 1,921,000 | 2,282,000 |
| Long-term debt | US$ in thousands | 8,259,000 | 8,224,000 | 8,244,000 | 7,745,000 | 7,735,000 | 7,671,000 | 8,062,000 | 8,752,000 | 8,011,000 | 8,039,000 | 8,432,000 | 8,437,000 | 7,885,000 | 7,922,000 | 8,632,000 | 8,613,000 | 7,672,000 | 7,631,000 | 7,701,000 | 7,675,000 |
| Total stockholders’ equity | US$ in thousands | 21,432,000 | 25,228,000 | 24,939,000 | 24,860,000 | 22,584,000 | 23,997,000 | 24,393,000 | 23,722,000 | 22,177,000 | 21,969,000 | 21,582,000 | 20,841,000 | 20,000,000 | 19,322,000 | 19,293,000 | 18,952,000 | 13,808,000 | 18,873,000 | 18,955,000 | 18,895,000 |
| Return on total capital | 16.70% | 16.08% | 16.62% | 17.77% | 18.48% | 16.85% | 14.55% | 12.31% | 11.77% | 10.99% | 9.63% | 9.09% | 7.93% | 7.30% | 8.20% | 7.38% | 9.26% | 6.80% | 7.21% | 8.59% |
December 31, 2023 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $4,958,000K ÷ ($8,259,000K + $21,432,000K)
= 16.70%
Archer-Daniels-Midland Company's return on total capital has shown a fluctuating trend over the past five years, with some periods exhibiting stronger performance than others. The return on total capital ranged from a low of 6.80% in December 2019 to a high of 18.48% in December 2022. Notably, the company experienced a steady increase in return on total capital from 2020 to 2022, indicating an improvement in the company's capital efficiency and profitability.
The return on total capital peaked at 18.48% in December 2022, suggesting an efficient allocation of capital and strong operational performance during that period. However, in the subsequent quarters of 2023, the return on total capital slightly decreased but remained above 16%, indicating sustained profitability relative to the company's capital base.
Overall, Archer-Daniels-Midland Company has demonstrated a generally positive trend in return on total capital, reflecting effective capital utilization and operational performance. Investors and stakeholders may view this metric as a key indicator of the company's ability to generate profits from its invested capital.
Peer comparison
Dec 31, 2023