Ashland Global Holdings Inc (ASH)
Return on total capital
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | -26,000 | 172,000 | 333,000 | 192,000 | -461,000 |
| Long-term debt | US$ in thousands | 1,349,000 | 1,314,000 | 1,270,000 | 1,596,000 | 1,573,000 |
| Total stockholders’ equity | US$ in thousands | 2,868,000 | 3,097,000 | 3,220,000 | 2,752,000 | 3,036,000 |
| Return on total capital | -0.62% | 3.90% | 7.42% | 4.42% | -10.00% |
September 30, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $-26,000K ÷ ($1,349,000K + $2,868,000K)
= -0.62%
Ashland Global Holdings Inc's return on total capital has fluctuated over the past five years. In 2024, the return on total capital was negative at -0.62%, indicating that the company's total capital generated a negative return during that period. This is a concerning sign as it suggests that the company may not be utilizing its capital efficiently.
In the previous year, 2023, the return on total capital was 3.90%, showing an improvement from the negative return in 2020. The company's performance further improved in 2022 with a return on total capital of 7.42%, indicating that Ashland Global Holdings Inc was able to generate a higher return on its total capital during that year.
In 2021, the return on total capital was 4.42%, slightly lower than the previous year but still positive, suggesting that the company was able to effectively utilize its capital to generate returns. In contrast, in 2020, the return on total capital was -10.00%, indicating a significant decline in efficiency in capital utilization compared to the following years.
Overall, Ashland Global Holdings Inc's return on total capital has shown variability in recent years, with both positive and negative returns. The negative return in 2024 raises concerns about the company's capital efficiency and may indicate areas where improvement is needed. Further analysis and comparison with industry peers would provide a more comprehensive assessment of the company's capital management and performance.
Peer comparison
Sep 30, 2024