Applied Industrial Technologies (AIT)
Return on total capital
| Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 496,980 | 501,549 | 497,907 | 491,605 | 499,113 | 484,909 | 488,823 | 485,972 | 471,681 | 454,021 | 422,868 | 389,175 | 357,248 | 329,208 | 307,913 | 224,557 | 202,332 | 165,959 | 14,024 | 78,131 |
| Long-term debt | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 1,844,520 | 1,827,480 | 1,793,510 | 1,752,080 | 1,688,780 | 1,669,020 | 1,608,030 | 1,536,120 | 1,458,440 | 1,380,660 | 1,295,880 | 1,221,440 | 1,149,360 | 1,098,390 | 1,021,690 | 976,570 | 932,546 | 934,907 | 880,707 | 885,406 |
| Return on total capital | 26.94% | 27.44% | 27.76% | 28.06% | 29.55% | 29.05% | 30.40% | 31.64% | 32.34% | 32.88% | 32.63% | 31.86% | 31.08% | 29.97% | 30.14% | 22.99% | 21.70% | 17.75% | 1.59% | 8.82% |
June 30, 2025 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $496,980K ÷ ($—K + $1,844,520K)
= 26.94%
The analysis of Applied Industrial Technologies’ return on total capital (ROTC) over the provided period indicates a pattern characterized by fluctuations and a general tendency toward stabilization at elevated levels.
Initially, the ROTC experienced a significant decline from 8.82% as of September 30, 2020, to a low of 1.59% by December 31, 2020. This sharp decrease suggests a period of diminished operational efficiency or challenges in generating returns relative to the total capital employed during that timeframe.
Subsequently, the metric exhibited a marked recovery, rising substantially to 17.75% as of March 31, 2021, and continuing an upward trajectory through the following quarters. The rate achieved a peak of 32.88% on March 31, 2023, reflecting improvements in profitability and effective utilization of total capital. During this period, the company demonstrated strong operational performance, with ROTC consistently maintaining above 30%, indicative of a high level of capital efficiency.
However, from that peak, a gradual decline has been observed. The rate decreased to 30.40% by December 31, 2023, and further to 29.05% as of March 31, 2024. This downward trend persists into subsequent periods, with the latest data point at 26.94% on June 30, 2025.
Overall, the fluctuations depict periods of capital efficiency enhancement and subsequent moderations, potentially influenced by macroeconomic factors, operational adjustments, or shifts in investment returns. Despite the recent decline, the overall levels remain relatively high compared to the initial figures, reflecting sustained, although somewhat reduced, effectiveness in generating returns from total capital employed over the period.