ChampionX Corporation (CHX)
Return on total capital
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 498,743 | 421,823 | 195,907 | 152,254 | -763,759 |
| Long-term debt | US$ in thousands | 591,453 | 594,283 | 621,702 | 697,657 | 905,764 |
| Total stockholders’ equity | US$ in thousands | 1,846,440 | 1,676,620 | 1,694,550 | 1,770,640 | 1,625,970 |
| Return on total capital | 20.46% | 18.58% | 8.46% | 6.17% | -30.17% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $498,743K ÷ ($591,453K + $1,846,440K)
= 20.46%
ChampionX Corporation's return on total capital has seen a significant improvement over the past five years. Starting from a negative return of -30.17% at the end of 2020, the company managed to turn around its performance to positive returns of 6.17% in 2021, 8.46% in 2022, 18.58% in 2023, and finally reaching 20.46% by the end of 2024.
This trend indicates that ChampionX has been able to effectively deploy its total capital to generate higher returns for its investors. The consistent increase in return on total capital demonstrates improved efficiency and profitability, reflecting positively on the company's financial health and management's ability to utilize resources effectively to drive growth.
Overall, the upward trajectory in ChampionX Corporation's return on total capital signifies a strengthening financial performance and suggests that the company is on a path towards enhanced value creation for its stakeholders.
Peer comparison
Dec 31, 2024