The Clorox Company (CLX)
Return on total capital
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 476,000 | 316,000 | 704,000 | 990,000 | 1,284,000 |
| Long-term debt | US$ in thousands | 2,481,000 | 2,477,000 | 2,474,000 | 2,484,000 | 2,780,000 |
| Total stockholders’ equity | US$ in thousands | 328,000 | 220,000 | 556,000 | 411,000 | 908,000 |
| Return on total capital | 16.95% | 11.72% | 23.23% | 34.20% | 34.82% |
June 30, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $476,000K ÷ ($2,481,000K + $328,000K)
= 16.95%
The Return on Total Capital (ROTC) for The Clorox Company has exhibited fluctuations over the past five years. In 2024, the ROTC stood at 16.95%, representing a moderate increase from the previous year's 11.72%. However, this figure is notably lower than the ROTC of 23.23% reported in 2022. Furthermore, the ROTC has shown a decreasing trend compared to the higher levels of 34.20% in 2021 and 34.82% in 2020.
The declining ROTC trend may indicate potential challenges in efficiently utilizing the company's capital to generate returns. It is essential for The Clorox Company to closely monitor and analyze its capital allocation strategies to enhance the ROTC figure and ensure sustainable financial performance in the future.