Alpha Metallurgical Resources Inc (AMR)
Return on total capital
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 852,382 | 1,576,550 | 361,852 | -374,535 | -302,085 |
| Long-term debt | US$ in thousands | — | — | 443,241 | 574,052 | 583,671 |
| Total stockholders’ equity | US$ in thousands | 1,573,930 | 1,429,760 | 546,909 | 200,102 | 696,122 |
| Return on total capital | 54.16% | 110.27% | 36.55% | -48.38% | -23.60% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $852,382K ÷ ($—K + $1,573,930K)
= 54.16%
Alpha Metallurgical Resources Inc's return on total capital has fluctuated significantly over the past four years. In 2023, the return on total capital stood at 56.02%, showing a decline from the previous year's figure of 112.23%, indicating a lower efficiency in generating returns from its total capital. However, compared to 2021 and 2020, where the returns were at 39.34% and -12.49% respectively, the company has shown improvement in capital utilization and profitability.
It is important to further investigate the factors that contributed to the decrease in return on total capital in 2023 compared to 2022, as this significant drop could indicate potential issues in operational efficiency or financial performance that may require management's attention. In contrast, the positive trend from the negative return in 2020 to the positive returns in subsequent years showcases a potential turnaround in the company's financial performance and capital management strategies.
Peer comparison
Dec 31, 2023