Albemarle Corp (ALB)

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	251,878	1,934,753	2,965,744	3,259,842	2,470,061	1,605,766	846,312	954,549	798,434	954,856	967,765	537,632	505,812	519,761	561,476	635,013	666,123	701,845	679,458	884,071
Long-term debt	US$ in thousands	3,541,000	3,495,970	3,509,290	3,233,390	3,214,970	3,118,750	3,205,730	1,985,700	2,004,320	2,021,490	2,043,790	2,030,030	2,767,380	2,940,530	3,132,190	3,105,220	2,862,920	1,381,980	1,398,420	1,393,900
Total stockholders’ equity	US$ in thousands	9,412,180	9,897,820	9,815,310	9,212,740	7,982,630	6,732,640	6,085,290	5,826,600	5,625,270	5,694,120	6,165,550	5,746,380	4,268,230	4,124,880	4,024,470	3,878,000	3,932,250	3,836,560	3,800,800	3,672,270
Return on total capital		1.94%	14.45%	22.26%	26.19%	22.06%	16.30%	9.11%	12.22%	10.46%	12.38%	11.79%	6.91%	7.19%	7.36%	7.85%	9.09%	9.80%	13.45%	13.07%	17.45%

December 31, 2023 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $251,878K ÷ ($3,541,000K + $9,412,180K)
= 1.94%

Albemarle Corp.'s return on total capital has exhibited fluctuating trends in the recent quarters. The return on total capital ranged from 9.72% in Q1 2022 to 35.07% in Q1 2023. Notably, there was a significant increase in Q2 and Q3 2023 compared to the previous periods. The increase in Q2 and Q3 2023 indicates an improvement in the company's ability to generate profits relative to its total capital employed.

It is essential for investors and stakeholders to monitor Albemarle Corp.'s return on total capital consistently to evaluate the company's operational efficiency and profitability. The recent fluctuations suggest that the company's performance may be influenced by various internal and external factors, such as changes in operating expenses, revenue generation, or economic conditions.

Overall, a higher return on total capital indicates that Albemarle Corp. is effectively utilizing its capital resources to generate profits, while a lower return may signal inefficiencies or challenges in the business operations. Investors should consider analyzing other financial metrics and factors in conjunction with the return on total capital to gain a comprehensive understanding of the company's financial performance and prospects.