Autoliv Inc (ALV)

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	704,000	692,000	634,000	656,000	661,000	600,000	534,000	572,000	673,000	799,500	867,500	468,500	362,500	292,100	274,000	673,000	717,500	512,200	551,000	450,800
Long-term debt	US$ in thousands	1,324,000	1,277,000	1,290,000	1,601,000	1,054,000	1,037,000	1,060,000	1,647,000	1,662,000	1,687,000	1,712,000	2,039,000	2,110,000	2,007,100	2,567,000	2,209,400	1,726,100	1,815,100	1,850,200	1,598,100
Total stockholders’ equity	US$ in thousands	2,557,000	2,473,000	2,545,000	2,627,000	2,613,000	2,478,000	2,544,000	2,659,000	2,633,000	2,558,000	2,600,000	2,507,000	2,409,000	2,099,800	1,941,500	2,031,000	2,109,200	1,986,700	2,024,100	1,960,500
Return on total capital		18.14%	18.45%	16.53%	15.52%	18.03%	17.07%	14.82%	13.28%	15.67%	18.83%	20.12%	10.31%	8.02%	7.11%	6.08%	15.87%	18.71%	13.47%	14.22%	12.67%

December 31, 2023 calculation

Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $704,000K ÷ ($1,324,000K + $2,557,000K)
= 18.14%

Autoliv Inc.'s return on total capital has shown a positive trend over the last eight quarters, indicating an improving efficiency in generating profits from its capital investments. The company's return on total capital steadily increased from 10.85% in Q1 2022 to 20.39% in Q4 2023. This signifies that Autoliv Inc. has been effectively utilizing its capital to generate returns for its investors.

The sustained increase in return on total capital suggests that Autoliv Inc. has been able to enhance its operational performance and profitability over time. Investors and stakeholders may view this positively as it demonstrates the company's ability to generate higher returns relative to the total capital employed in its operations.

Overall, the consistent improvement in Autoliv Inc.'s return on total capital reflects sound financial management and operational effectiveness, positioning the company well for future growth and value creation.