Charles River Laboratories (CRL)
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 | 227,347 | 712,248 | 675,896 | 546,765 | 532,545 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 3,461,500 | 3,596,880 | 2,976,290 | 2,534,820 | 2,114,600 |
| Return on total capital | 6.57% | 19.80% | 22.71% | 21.57% | 25.18% |
December 31, 2024 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $227,347K ÷ ($—K + $3,461,500K)
= 6.57%
Based on the data provided, Charles River Laboratories' return on total capital has experienced fluctuations over the past five years.
- In December 31, 2020, the return on total capital was 25.18%, indicating that the company generated $0.2518 in profit for every dollar of total capital employed.
- By December 31, 2021, the return on total capital had decreased to 21.57%, suggesting a slight decline in the company's ability to generate returns from its capital base.
- In December 31, 2022, the return on total capital improved to 22.71%, showing a recovery from the previous year's dip.
- However, by December 31, 2023, the return on total capital declined to 19.80%, signaling a decrease in efficiency in utilizing the company's total capital.
- The most significant drop occurred by December 31, 2024, where the return on total capital fell sharply to 6.57%. This substantial decline may raise concerns about the company's capital allocation and operational performance during that period.
Overall, while the return on total capital has exhibited some variability, it is essential for Charles River Laboratories to closely monitor and evaluate its capital utilization to enhance profitability and shareholder value in the future.
Peer comparison
Dec 31, 2024